South Korea moves to block Polymarket, calling crypto prediction site an illegal gambling venue South Korea’s communications regulator has voted to ask internet providers to block access to Polymarket, concluding the crypto-based prediction market creates an illegal gambling environment for domestic users. On Aug. 18 the Broadcasting, Media and Communications Review Committee issued a corrective request after examining how Polymarket creates markets, sets trading rules, handles crypto deposits and withdrawals, settles trades and collects trading fees. The committee said those functions—in particular the operator’s control over market creation and the infrastructure used to move funds—mean Polymarket effectively facilitates activity that falls under prohibitions in the Criminal Act and the National Sports Promotion Act, including assistance in gambling and the opening of gambling venues. Why regulators say Polymarket crosses the line - Polymarket’s model ties tradable “shares” to the outcomes of events ranging from politics, elections and economics to sports and weather. Regulators characterized the winner‑takes‑all structure as one that encourages speculative gambling behaviour, exposing users to potentially extreme gains or losses tied to events they cannot control. - Although trades occur between users, the committee focused on the operator’s role in creating markets, defining trading rules and providing the on‑ramps and off‑ramps for crypto—functions that allow the platform to collect and distribute user funds and earn transaction fees. - The regulator highlighted markets specifically relevant to Korean users—citing, for example, a contract on August rainfall in Seoul—as evidence the site still served domestic audiences despite steps the company had taken to limit local access. Polymarket’s defense, and the committee’s response Polymarket argued during review hearings that it is non‑custodial and peer‑to‑peer: trades are executed through smart contracts, the platform does not act as an organizer of wagers, and it does not directly hold user funds or issue sports‑promotion betting tickets. The company removed a Korean‑language interface and said payments in South Korean won were unavailable. The committee rejected those defenses, saying that technical decentralization, removal of a Korean language option or the absence of direct KRW payments do not exempt a service from domestic law if Korean users can still access markets using crypto. Regulators concluded an access block was necessary to protect local users. Enforcement timeline and earlier probes - The committee’s Aug. 18 vote follows a review process started in July, when regulators opened a hearing and gave Polymarket an opportunity to respond. - In late May, South Korean police launched a criminal investigation into Polymarket users suspected of participating in illegal gambling via election‑related markets—the first known domestic police probe targeting the platform’s users. - Before deciding, the review committee solicited input from the National Police Agency, the National Gambling Control Commission and the Korea Sports Promotion Foundation, all of which indicated Polymarket’s structure could fall within gambling and venue‑establishment rules. Part of a broader global clampdown South Korea’s action mirrors moves by several other jurisdictions. India ordered access to Polymarket blocked in May after an April advisory to internet service providers and VPN operators; authorities cited concerns about stablecoin payments, offshore betting and unmonitored capital flows. The Czech Republic ordered providers to block the site in July, and France blocked access beginning July 16 over risks such as large losses and possible manipulation. The article notes Australia and Germany implemented blocking measures in August and September 2025, and other countries including Argentina and Spain have imposed restrictions in recent months. What this means for prediction markets and users The decision underscores a growing regulatory consensus that some prediction markets can function like gambling platforms when operators exercise control over market mechanics and benefit economically from trades. For users, the ruling signals heightened enforcement risk and reinforces the need for caution when participating in event‑based crypto markets that may be targeted by domestic law enforcement. Polymarket continues to maintain that its non‑custodial, smart‑contract based model is not equivalent to a conventional gambling operator. But South Korean regulators have made clear they view accessibility and practical effects for local users—not just underlying technical architecture—as the key test for applying domestic law. Read more AI-generated news on: undefined/news