South Korea has moved Polymarket closer to direct regulatory action as authorities review whether the prediction market platform may breach local gambling rules.
The Broadcasting, Media and Communications Review Committee said it will hear from Polymarket before deciding whether to issue a corrective request. The step gives the company a chance to explain how its service works before the committee makes a final call.
South Korea opens review into Polymarket
South Korean media reported that the committee’s communications review subcommittee decided on July 6 to allow Polymarket to submit its position. The panel said it wants to review the company’s legal status and operating model before deciding whether to take action.
Polymarket allows users to trade on yes-or-no outcomes tied to real-world events. These markets can cover politics, elections, economics, sports, weather and other public events. Users place trades with crypto assets, and winning positions can settle for a payout when the event resolves.
The committee said it wants to check “the legality of Polymarket and the way the service is operated” before reaching a final decision. The quote matters because it shows the review is not only about South Korean users. It also places the platform’s structure under scrutiny.
The review does not mean South Korea has banned Polymarket. At this stage, officials are allowing the company to respond. The next step will depend on how the committee views the company’s explanation, its access controls and its role in event-based trading.
User probe came before platform review
The latest review follows an earlier investigation into South Korean Polymarket users. In June, Gangwon Provincial Police began a probe into local users over alleged illegal gambling tied to election-related prediction markets. The case was reportedly requested by the National Police Agency.
That earlier case focused on whether users had violated South Korea’s gambling laws by using the platform. The new review moves attention toward Polymarket itself. It asks whether the platform’s service model could fall within the country’s rules on illegal gambling.
South Korea’s Criminal Act states that gambling can be punished by a fine of up to 10 million won. It also says habitual gambling can lead to up to three years in prison or a fine of up to 20 million won.
South Korea’s National Gambling Control Commission Act also gives authorities a framework to monitor illegal gaming activity. The law covers illegal gaming businesses and gives regulators a basis to respond to online services that enable speculative gambling.
Polymarket’s access limits face another test
Polymarket says it restricts access in some countries and regions for compliance reasons. Its documentation says restrictions fall into full blocks, close-only access and frontend-only limits. The company also says the rules apply through frontend access, API access or both, depending on the jurisdiction.
Polymarket’s help page says 33 countries are completely restricted from accessing the platform. The list includes Australia, Brazil, France, Germany, Italy, Japan and the United Kingdom. The page was updated four days before the South Korean review became public.
South Korea’s name on this issue is important because local authorities have already moved from user-level checks to platform-level review. Regulators may now look at whether geoblocking, compliance notices and access controls are enough to keep local users away from markets that authorities may treat as gambling.
The company’s restrictions also show how prediction markets now face a cross-border problem. A platform may block some countries, limit others and still face questions about how users reach the service. That issue has become central as prediction markets grow in crypto, sports and politics.
Broader prediction market pressure
In a related report, The Coin Headlines noted that the U.S. Commodity Futures Trading Commission was preparing a prediction market overhaul and could review sports event contracts case by case instead of applying a blanket ban.
Additionally, that report showed how U.S. regulators are trying to separate allowed event contracts from products that may raise fraud, manipulation or public-interest concerns. It also noted that prediction markets have drawn more attention because they can cover politics, sports and other real-world events.
As previously reported, Michigan temporarily blocked Kalshi from offering sports event contracts to state residents. The court order required Kalshi to stop offering those contracts for 14 days and warned that the company could face fines if it failed to block Michigan users through geolocation tools.
Furthemore, Kentucky had sued Kalshi, Polymarket and other platforms over claims that they were operating unlicensed sports betting businesses. That case adds Polymarket to the same U.S. state-level fight over whether prediction markets should be treated as financial products or betting services.
Europe adds pressure on event contracts
Europe has also tightened its view of prediction markets. The European Securities and Markets Authority said firms must assess whether event contracts fall under existing binary options restrictions. ESMA said not all event contracts are financial instruments, but some may qualify as derivatives under MiFID II.
Event contracts with fixed payouts may face retail restrictions in the EU if they fall within binary options rules, as previously reported. Firms must check a contract’s structure, payout model and underlying exposure before offering it to retail users.
Moreover, Europe is drawing a line between crypto firms operating under MiCA and prediction market platforms offering products that may resemble binary options. That matters for platforms such as Polymarket because the legal test may depend less on branding and more on how the product pays users.
