South Korea's Broadcasting, Media and Communications Review Committee has initiated a hearing process to examine Polymarket's legality as regulators consider whether the prediction market platform violates gambling laws. According to reports from the committee, it has decided to hear Polymarket's position before ruling on whether to issue a corrective request against the platform. The committee stated this additional step would allow verification of both the legality of the service and its operational methods before reaching a final conclusion.
South Korea will introduce civil seizure rules for digital assets from October 1, allowing courts to directly freeze, transfer, and liquidate cryptocurrencies held on local exchanges. The Supreme Court is currently gathering feedback on the revised Civil Execution Rules, which detail enforcement procedures including transfer orders and sale through licensed exchanges. This marks a significant step in integrating crypto into the country's legal framework for debt recovery, following earlier discussions on virtual asset civil enforcement.
The media regulator's review aligns with global scrutiny of prediction markets, which are classified as regulated commodities under updated Chrome Web Store policies. Potential restrictions in South Korea could impact Asian user access to the platform, which has gained traction for election and event betting. The review follows an earlier police investigation into local Polymarket users over alleged illegal gambling connected to election-related prediction markets, with the Gangwon Provincial Police launching what was described as the country's first investigation into Polymarket users over alleged illegal gambling in early June.
Polymarket states that access restrictions on its platform are designed to comply with sanctions, local financial regulations, gambling and prediction market laws, anti-money laundering requirements and Know Your Customer rules. As reported by the company, users from 33 countries, including the United States, the United Kingdom, France, Germany, Brazil, Singapore, Japan, and Australia, cannot access the platform. The company also blocks certain regions within otherwise permitted countries, including several Canadian provinces and parts of eastern Ukraine.
The South Korean review adds to increasing regulatory attention facing prediction market operators worldwide. Earlier this month, the European Securities and Markets Authority clarified that some event-based contracts offered in the European Union could fall within the scope of the Markets in Financial Instruments Directive II if they qualify as financial instruments. In the United States, Bloomberg and CNBC reported that the Commodity Futures Trading Commission is conducting a broad investigation into Polymarket's business activities, including its social media operations. On-chain research firm Allium reported that U.S.-linked wallets traded about $571 million worth of political contracts on Polymarket during the past year despite platform restrictions on American users.
