Wartime Snapshot: How Prediction Markets Are Pricing the Iran Conflict

Prediction markets tracking the escalating Middle East conflict between the United States, Israel and Iran are humming with activity on Tuesday, as traders funnel more than $230 million into bets tied to regime change, military escalation, and diplomatic outcomes.

Polymarket Traders Price 42% Chance of Iranian Regime Collapse by June 30

On Polymarket, the headline-grabbing contract asks: “Will the Iranian regime fall by June 30?” As of Tuesday morning, traders price that outcome at 42%, with “Yes” shares at 42 cents and “No” at 60 cents. Since launching in December 2025, the market has generated about $6.51 million in trading volume.

That specific wager is just one piece of a much larger puzzle. Two Polymarket contracts tied to now-deceased Supreme Leader Ali Khamenei have effectively settled at 100% probability that he will be out of power — one by Feb. 28 with $115 million in volume and another by March 31 with $62 million. Combined, those two settled markets alone account for $177 million in trades.

Speculation over succession is also brisk. A Polymarket contract on the “Next Supreme Leader” has drawn $7 million, while a related bet on whether a new Supreme Leader will be installed by March 31 sits at 73% odds with $2 million in volume. Within the succession chatter, Ali Larijani currently commands a 6% probability in that field.

Military escalation markets are equally active. Traders assign an 84% chance that Iran strikes Israel on March 3, with nearly $1 million in volume behind that bet. There is also an 82% probability that Iran will fully close the Strait of Hormuz by year’s end, supported by $9 million in trading. Reports detail that the Strait of Hormuz is not formally closed under international law, but commercial traffic has effectively stopped, as Iran is threatening to attack ships that try to pass.

Another Polymarket wager shows a 41% chance U.S. forces enter Iran before Dec. 31, with $3 million at stake. At the same time, markets show a notable appetite for de-escalation scenarios. The probability of a U.S.-Iran ceasefire by June 30 stands at 79%, backed by $8 million in volume. Conversely, a formal U.S. declaration of war carries just an 11% probability, with $1 million traded.

Internal political shifts are another focal point. The market for Reza Pahlavi entering Iran by year’s end stands at 34%, drawing $4 million in volume. A separate contract giving him a 19% chance of leading the country in 2026 has seen $255,000 in trading. Bets on a U.S.-Iran nuclear deal by March 31 sit at 12% with $683,000 in volume, while Iran agreeing to end uranium enrichment by that date carries similar skepticism at 12% with $1 million traded. A potential U.S. cyberattack on Iran by the end of March holds 29% odds with $232,000 in volume.

Kalshi Traders Price 19% Odds That Iran’s Supreme Leader Role Is Abolished

On the predictions marketplace platform Kalshi, traders are placing their own bets. The most active market today — forecasting Iran’s next Supreme Leader — has seen $4,112,801 in volume, with Alireza Arafi at 17% and a 19% probability that the role is abolished entirely.

Kalshi’s Strait of Hormuz market has logged $2,467,774 in volume, assigning a 40% chance of closure for seven or more days before 2027 and 38% before August. A U.S.-Iran nuclear deal before 2027 carries a 54% probability, backed by $642,132 in trading.

Additional Kalshi contracts show $539,850 wagered on whether Pahlavi will lead Iran this year, $399,208 on whether he will visit, and $357,460 on U.S. recognition of him as leader. Smaller markets include a potential visit by Donald Trump to Iran before 2027 (22% odds, $26,990 volume) and Iran becoming a democracy this year (16%, $11,323 volume).

Combined, the Polymarket and Kalshi contracts referenced above account for more than a quarter billion in trading volume — a striking sum that reflects how retail and institutional traders alike are pricing geopolitical risk in real time. Whether those wagers prove prescient or premature remains to be seen, but the message from prediction markets is clear: The Middle East conflict is not just a headline — it is today’s high-stakes trade.

FAQ 🔎

• **How much volume has been traded on Iran-related prediction markets?**About $233.21 million across the Polymarket and Kalshi contracts cited as of March 3, 2026.
• **What are traders saying about the Iranian regime’s stability?**Polymarket currently assigns a 41% chance the regime falls by June 30.
• **Are markets expecting a Strait of Hormuz closure?**Odds range from 40% to 80% depending on timing and platform.
• **What are the chances of a U.S.-Iran nuclear deal?**Probabilities vary from 12% on short-term contracts to 54% on longer-dated Kalshi markets.