South Korea Targets 26 Polymarket Users Over $12.7 Million Betting Case

Summary

• South Korean police booked 26 Polymarket users over $12.7 million in wagers and referred 18 suspects to prosecutors for review.
• Authorities classify event contracts as gambling, while accused users argue Polymarket operates as a derivatives marketplace with tradable positions early.
• Polymarket disputes South Korea’s access block, arguing its non-custodial model differs from gambling platforms and rejecting regulators’ classification of its operations.

South Korean police have booked 26 Polymarket users for allegedly placing illegal wagers worth 17.6 billion won, or $12.7 million. According to Asia Business Daily, the Gangwon Provincial Police Agency investigated the users through its cybercrime unit.

Police and Users Clash Over Polymarket’s Legal Status

Investigators referred 18 individuals to prosecutors, moving cases toward criminal proceedings. One user recorded the largest stake, placing contracts worth 5.7 billion won, equivalent to $4.1 million.

Authorities argue Polymarket contracts constitute gambling because users stake assets on outcomes beyond their control. Article 246 of South Korea’s Criminal Act prohibits gambling and permits authorities to pursue participants.

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However, police maintain that market pricing does not remove the gambling element linked to uncertain outcomes. Individuals facing prosecution reportedly rejected the gambling classification and described Polymarket as a cryptocurrency-based derivatives marketplace.

Their argument centers on the platform’s order book, which allows users to trade contracts before events conclude. Consequently, participants can close positions early instead of awaiting an event’s outcome to determine their returns.

Courts could therefore examine whether tradable event contracts represent financial instruments or prohibited wagers under South Korean law. That distinction may become central if prosecutors charge the referred users and pursue trials.

Regulators Increase Pressure on Prediction Markets

South Korea’s media regulator previously ordered internet providers to block access to Polymarket. Regulators determined that the platform created an illegal gambling environment accessible to residents without domestic authorization.

Polymarket disputed that assessment, arguing its non-custodial model differs from traditional gambling businesses. Additionally, the platform does not accept Korean won payments and has removed Korean-language services from its interface.

Those restrictions did not persuade regulators that Polymarket falls outside the country’s gambling laws. Prosecutors must determine whether evidence supports potential charges against the 18 referred individuals under Article 246.

Meanwhile, the remaining eight booked users could face further action depending on investigative findings and prosecutorial review. Ultimately, the dispute could determine how South Korea regulates decentralized prediction markets and event-contract platforms serving local users.

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