South Korea launches first illegal gambling probe into Polymarket users
In brief
- South Korean police launch first illegal gambling probe into Polymarket users, led by Gangwon Provincial Police
- Violators face fines up to 10 million won ($6,500) under Article 246 of the Criminal Act
- Polymarket remains accessible in South Korea despite bans in 35 other regions globally
- Investigation coincides with election-betting activity on prediction markets during recent South Korean elections
Enforcement and Penalties
Users may face fines of up to 10 million won ($6,500) under Article 246 of the Criminal Act covering gambling and habitual gambling. South Korea maintains Sports Toto as its state-authorized sports betting platform, and the investigation suggests authorities view Polymarket as an unlicensed competitor operating outside the regulated framework.
Polymarket remains accessible in South Korea despite the probe. The platform has faced geoblocking elsewhere — it's entirely geoblocked in 35 regions globally, and several countries have completely blocked or prohibited Polymarket, including Singapore, Poland, Portugal, Hungary, Ukraine, Brazil and Indonesia.
Election-Betting Context
The probe arrives amid heightened activity on prediction markets tied to South Korean politics. President Lee Jae Myung's ruling Democratic Party swept most major local elections held on Wednesday, while conservative Oh Se-hoon won another term as mayor of Seoul.
One Polymarket contract on whether Lee Jae-myung would be out as president saw nearly $54,000 in total trading volume. That level of activity underscores investor interest in political outcomes via decentralized platforms.
Broader Regulatory Pressure
The South Korean action reflects growing scrutiny worldwide. In January, US lawmakers proposed legislation aimed at restricting political prediction market trading by government officials. In May, the chair of the US House of Representatives' Oversight and Government Reform Committee sent letters to the CEOs of Kalshi and Polymarket questioning their response to insider trading allegations.
Polymarket has acknowledged these pressures. The platform said it was weighing the implementation of a mandatory identity verification system more in line with global Know Your Customer (KYC) verification standards. That move could reshape access and compliance across jurisdictions, including South Korea.
