Japanese licensed crypto exchange Bitbank has issued a stark warning to its users, stating that any account found to be involved with offshore prediction market platforms like Polymarket may be immediately suspended. The June 15 notice marks one of the most aggressive moves yet by a regulated Japanese exchange to police the flow of funds to DeFi-based betting venues. Bitbank emphasized that using such services from within Japan for monetary gain could be considered illegal gambling under the country's Criminal Code, which strictly prohibits most forms of wagering except for limited state-run activities.
The consequences are severe: once flagged, a suspended account loses all core functions, including login access, cryptocurrency deposits and withdrawals, Japanese yen withdrawals, and all trading capabilities. Bitbank stated it will accept no liability for losses resulting from a suspension. The exchange specifically named Polymarket, which operates on the Polygon network, and grouped it with other prediction market services that carry betting characteristics. While Polymarket does not directly serve Japanese customers in a licensed capacity, anyone with a crypto wallet can interact with its smart contracts, creating a legal gray zone.
Bitbank’s compliance team will monitor on-chain deposits and withdrawals for links to these markets, using both behavioral patterns and off-chain data. Importantly, the policy does not target any specific cryptocurrency—the MATIC token used for Polymarket fees remains unrestricted on the platform. Instead, the exchange is targeting user behavior, treating transfers to or from known prediction market addresses as potential evidence of illegal activity. Customers who believe their account was wrongly suspended may appeal through Bitbank’s inquiry form, but the burden of proof rests on the user.
The move comes amid heightened global scrutiny of prediction markets. Ukraine blocked domestic access to Polymarket in January 2026, while US lawmakers debate the classification of such platforms. Polymarket itself has tightened its terms to curb manipulation and has signaled long-term ambitions in Japan, appointing a local representative to lobby for eventual regulatory approval by 2030. No other Japanese exchanges have followed Bitbank’s lead yet, and the industry self-regulatory body JVCEA has not issued a coordinated statement. However, the warning hints at increasing pressure from regulators like the Financial Services Agency to treat prediction market proceeds as potentially tainted funds.
