South Korean Authorities Launch Investigation Into Polymarket Users for Alleged Illegal Gambling
Authorities in South Korea have initiated what is believed to be the nation's inaugural illegal gambling investigation targeting domestic users of Polymarket as scrutiny over election betting intensifies.
Authorities in South Korea have initiated what is reported to be the nation's inaugural investigation into illegal gambling activities involving domestic users of Polymarket, expanding regulatory oversight of the decentralized prediction marketplace platform.
According to ChosunBiz, the investigation is being spearheaded by Gangwon Provincial Police following a formal request from the National Police Agency.
Those under investigation could potentially face penalties reaching up to 10 million won ($6,500) pursuant to Article 246 of the Criminal Act, which addresses gambling and habitual gambling offenses. Under existing legislation, Sports Toto serves as the government-sanctioned sports betting platform, whereas unauthorized online wagering activities are subject to prosecution under South Korean gambling statutes.
The investigation being reported contributes to an expanding global enforcement effort targeting prediction markets, with multiple jurisdictions either blocking or limiting access to Polymarket. A number of nations have implemented complete blocks or prohibitions on Polymarket, among them Singapore, Poland, Portugal, Hungary, Ukraine, Brazil and Indonesia. In South Korea, Polymarket continues to be accessible.
This development follows President Lee Jae Myung's ruling Democratic Party securing victories in the majority of significant local elections conducted on Wednesday, with conservative candidate Oh Se-hoon securing another term in his role as mayor of Seoul, as reported by Reuters.
A single Polymarket contract focused on the question of whether Lee Jae-myung would depart from the presidency recorded nearly $54,000 in aggregate trading volume, according to available data.
Political betting faces growing scrutiny
This most recent investigation contributes to mounting regulatory oversight targeting political wagering activities on Polymarket.
During January, United States legislators put forward proposed legislation designed to limit political prediction market trading activities by government officials following an incident where a Polymarket user earned more than $400,000 on a contract connected to the potential removal of then-Venezuelan President Nicolás Maduro, sparking concerns regarding insider trading practices.
During May, the chairman of the US House of Representatives' Oversight and Government Reform Committee dispatched correspondence to the chief executive officers of Kalshi and Polymarket, challenging their response to insider trading accusations involving activities on the platforms.
Addressing the increasing scrutiny, Polymarket indicated it was considering the implementation of a mandatory identity verification system more aligned with international Know Your Customer (KYC) verification standards, as Cointelegraph reported on May 27.
According to Polymarket, the platform maintained complete geoblocking across 35 regions as of the time of publication.