South Korean authorities have launched the country’s first investigation into domestic Polymarket users, marking a significant escalation in regulatory scrutiny of the crypto-based prediction market platform.
Key Takeaways
- South Korean police have opened their first investigation into local Polymarket users over alleged illegal gambling activity.
- Users found in violation of gambling laws could face fines of up to 10 million won, or roughly $6,500.
- The probe follows heavy betting activity tied to South Korea’s June 3 local elections, including more than $52 million wagered on the Seoul mayoral race.
- The development adds to growing global pressure on Polymarket as regulators in multiple countries review or restrict the platform.
What Happened?
South Korea’s National Police Agency has launched the country’s first investigation into domestic users of Polymarket, a crypto-powered prediction market platform that allows participants to wager on the outcomes of political, economic, sports, and social events.
The investigation is being led by the Gangwon Provincial Police Agency and targets users across the country who allegedly placed bets through the platform. Authorities suspect that such activity may violate South Korea’s strict gambling laws, which permit only limited forms of state approved betting.
South Korean police launch first illegal gambling probe into local users of Polymarket, the world’s largest prediction market
— Wu Blockchain (@WuBlockchain) June 5, 2026
According to ChosunBiz, South Korean police are investigating local Polymarket users on suspicion of illegal gambling, reportedly the first such case… pic.twitter.com/wZOP2WBdqs
South Korea Tightens Scrutiny on Prediction Markets
The investigation comes shortly after South Korea’s June 3 local elections, which generated substantial betting activity on Polymarket. Markets tied to election outcomes attracted significant attention, with wagers on the Seoul mayoral race alone reportedly exceeding $52 million.
According to local reports, election related betting volumes reached hundreds of billions of won across multiple prediction markets on the platform.
South Korean law prohibits citizens from placing sports bets through unauthorized services. The only legal sports betting platform is Sports Toto, operated by the Korea Sports Promotion Foundation. Individual wagers on Sports Toto are capped at 100,000 won, or approximately $65.
Authorities believe Polymarket users may have violated Article 246 of South Korea’s Criminal Act, which covers gambling and habitual gambling offenses. Violators can face fines of up to 10 million won, equivalent to roughly $6,500.
Legal Questions Remain Unanswered
Despite the ongoing investigation, legal experts say the outcome remains difficult to predict because South Korea has never previously prosecuted users for participating in Polymarket markets.
Attorney An Chang bo of Respect Law Office, who represents some individuals involved in the case, said:
The lack of legal precedent could make the case a closely watched test of how South Korean authorities classify decentralized prediction markets under existing gambling laws.
Regulators Consider Further Action
The police investigation follows a separate regulatory review already underway in South Korea.
In May, the Korea Communications Standards Commission began examining whether Polymarket’s event contracts and services constitute illegal gambling under national law. Authorities are also reportedly considering restricting or blocking access to the platform if violations are confirmed.
The review highlights broader concerns among regulators regarding prediction markets that allow users to speculate on political and real world events using cryptocurrency.
Global Pressure on Polymarket Continues to Grow
South Korea is not alone in scrutinizing Polymarket.
The platform has already been blocked or restricted in several countries, including India, Indonesia, Singapore, Brazil, Portugal, Poland, Hungary, and Ukraine. Indonesian authorities recently moved to block access to the platform as part of a wider campaign against online betting services.
At the same time, Polymarket continues pursuing international expansion. Bloomberg recently reported that the company has hired a representative in Japan as it explores opportunities to offer prediction markets there in the coming years.
The platform has also increased compliance efforts globally, including stronger identity verification requirements for users amid rising regulatory pressure.
Polymarket’s Growth Draws Regulatory Attention
Since launching in 2020, Polymarket has become one of the most prominent prediction market platforms in the crypto industry. Users can place wagers on a wide range of topics, from elections and government policy decisions to sports and cultural events.
According to data cited by The Block, cumulative trading volume across Polymarket and Polymarket U.S. has reached approximately $88.6 billion as of June 5.
The growing popularity of prediction markets has also attracted attention from lawmakers in the United States. House Administration Committee Chairman Bryan Steil recently announced plans to expand his Stop Insider Trading Act to prohibit members of Congress and their families from participating in prediction markets tied to elections and government decisions.
Steil said:
CoinLaw’s Takeaway
In my experience, the South Korean investigation could become one of the most important regulatory tests for prediction markets outside the United States. What makes this case notable is not just the potential penalties but the fact that authorities are attempting to apply traditional gambling laws to a rapidly growing crypto-based market structure.
I found that the outcome could influence how other jurisdictions approach prediction markets in the future. As platforms like Polymarket expand globally and attract billions in trading volume, regulators appear increasingly determined to decide whether these services are financial tools, information markets, or simply another form of online gambling.
