South Korea Launches Review of Prediction Market Platform Polymarket
The Korea Communications Standards Commission has officially launched a review of the prediction market platform Polymarket to determine whether it constitutes illegal gambling under South Korean law.
The review follows multiple recent user complaints, and the commission is referencing precedents from countries like France, Germany, and Italy, which have blocked Polymarket.
Industry insiders are concerned that this review may lead to a complete ban of Polymarket in South Korea. Lawyers point out that even if the servers are overseas, if localized services are provided to South Korean users, it may still fall under regulatory scrutiny.
Source: Public Information
ABAB AI Insight
Polymarket has faced ongoing global regulatory pressure since gaining prominence during the 2024 U.S. election due to high trading volumes and accurate predictions. This review in South Korea continues the trend of blocking in several European countries, following multiple complaints regarding the gambling nature of prediction markets that have prompted enforcement actions.
In terms of capital pathways, Polymarket is shifting compliance resources towards regions with local licenses while attempting to mitigate the impact of bans through VPNs and decentralized access, motivated by the need to maintain user traffic in Asia. However, South Korea, as a market with strict financial regulations, poses challenges for the platform to quickly obtain local operating licenses, leading to potential user and trading volume losses.
Similar to India's recent blocking of Kalshi and Polymarket, as well as the bans in several European countries under gambling laws, the global prediction market industry is transitioning from rapid gray market growth to strict compliance or regional exits, significantly compressing the survival space for small to medium platforms.
Essentially, this reflects a regulatory shift: the review will transfer pricing power from globally open prediction markets to locally regulated platforms or underground channels. The mechanism is that prediction markets, which combine speculative and information aggregation attributes, are easily classified as illegal gambling, forcing platforms to shift from "global without borders" to "local compliance first," accelerating capital concentration towards licensed localized services.
ABAB News · Cognitive Law
The more accurate the predictions, the faster the regulation comes; global liquidity fails before national borders. Platforms without local licenses, no matter how popular, are merely temporary visitors. The more apparent the gambling attributes, the higher the compliance costs, ultimately leaving only licensed operators to harvest the remaining traffic.