South Korea has banned Polymarket from operating in the country. Industry analysts expect the move to stifle the domestic prediction market sector and cut off a potential revenue stream for local crypto exchanges.
The Korea Communications Standards Commission ruled that Polymarket violates national gambling law and the National Sports Promotion Act. The regulator said the platform 'effectively creates a gambling environment' because it uses a winner-takes-all model and accepts wagers on outcomes ranging from elections to August rainfall in Seoul. Polymarket attempted to challenge the ban by removing Korean language support and the won, but KCSC was not persuaded.
Kim Yu-gyeom, an analyst at crypto provider Four Pillars, called the decision a mistake. He pointed to a 2023 US precedent when a District of Columbia court sided with platform Kalshi in a dispute with the CFTC, ruling that election contracts are an economic instrument, not gambling. 'Weather and financial contracts can be used to hedge real business risks,' Kim said.
Upbit and Bithumb shut out
The ban will hit South Korea's largest exchanges, Upbit and Bithumb. In the US, rivals Coinbase and Gemini recently launched their own prediction services and grew revenue. That route is now closed to Korean players, even as trading volumes and income decline. South Korea joins Germany, France, Spain, the Netherlands, the UK and several US states in banning Polymarket. In June a Korean trader won around $160,000 on the Seoul mayoral election through the platform — an incident that accelerated the regulator's response.
