South Korean police launch first probe into local Polymarket users over illegal gambling

South Korea's National Police Agency is investigating domestic users of Polymarket under charges of illegal gambling, according to ChosunBiz. The Gangwon Provincial Police Agency has launched the probe into nationwide Polymarket traders, marking South Korea's first-ever investigation into local users of the prediction market platform. Users may face fines of up to 10 million Korean won (about $6,500) under Article 246 of the Criminal Act, which covers gambling and habitual gambling.

The investigation comes just days after South Korea's local elections on June 3, which spawned multiple sizable bets on Polymarket. Contracts predicting the Seoul mayoral race drew in over $52 million in trading volume — a tidy sum for a single municipal contest, and one that apparently caught regulators' attention. One contract on whether President Lee Jae Myung would be out as president in 2026 saw nearly $54,000 in total volume. Lee's Democratic Party swept most major races, while conservative Oh Se-hoon won another term as Seoul mayor.

Under current Korean law, Sports Toto is the sole authorized sports betting platform, operated by the Korea Sports Promotion Foundation and capping individual bets at 100,000 won ($65). Anything outside that narrow lane is, in regulatory terms, off-piste. Last month, the Korea Communications Standards Commission began reviewing whether Polymarket's services constitute illegal gambling after receiving a complaint about its event contracts.

The probe is part of a wider global crackdown. Polymarket is fully geoblocked in 35 regions, including Singapore, Poland, Portugal, Hungary, Ukraine, Brazil, Indonesia, and India. Indonesian authorities recently blocked local access as part of a broader online betting sweep. The platform, however, remains accessible in South Korea — a situation likely to remain temporary in the way most crypto regulatory reprieves are.

In the United States, regulatory pressure is also mounting. In January, lawmakers proposed legislation restricting political prediction market trading by government officials after a Polymarket user netted over $400,000 on a contract tied to the removal of then-Venezuelan President Nicolás Maduro, raising insider trading concerns. In May, the chair of the US House Oversight and Government Reform Committee sent letters to the CEOs of Kalshi and Polymarket questioning their response to the allegations.

Polymarket has signaled it is weighing a mandatory identity verification system more aligned with global KYC standards,