Polymarket is confronting a widening regulatory crackdown across several countries, with South Korea becoming the latest jurisdiction to block access to the prediction markets platform and the company now fighting a Dutch gambling order in court.
South Korea’s Korea Communications Standards Commission (KCSC) voted on August 18 to restrict the platform, citing concerns that its markets on politics, elections, sports, and weather could encourage illegal gambling. The regulator said users take positions on outcomes and stand to win or lose based on the result. The action follows France blocking access from July 16 over risks of massive losses and betting manipulation, as well as restrictions in Australia in August 2025 and Germany in September 2025.
Polymarket has defended its model as non-custodial and peer-to-peer, arguing that smart contracts mean the company does not directly control user funds. Still, regulators are examining wider platform operations, including how markets are opened, trading rules are set, and fees are collected through cryptocurrency deposit and settlement systems.
The regulatory pressure also comes as competition in the prediction market space intensifies. According to figures shared by Wu Blockchain, rival platform Kalshi has jumped from less than 10% of crypto volume market share to more than 92% in eight months, a major setback for Polymarket.
In the Netherlands, Polymarket has filed a lawsuit in The Hague against the Dutch Gambling Authority (Ksa), which classified its prediction markets as illegal gambling. The Dutch regulator had threatened weekly penalties of up to €840,000, with a maximum of €420,000. Polymarket says its USDC-settled contracts are more akin to financial derivatives and should be regulated by the AFM rather than the Ksa. The case may shape how event-based crypto contracts are treated across Europe.
Together, the South Korean block, prior restrictions in France, Australia and Germany, and the Dutch legal fight highlight growing regulatory uncertainty for blockchain-based prediction markets.
