Ko Gwang-heon, chairman of the Korea Communications Standards Commission. [Yonhap]
Ko Gwang-heon, chairman of the Korea Communications Standards Commission. [Yonhap]

South Korea's Korea Communications Standards Commission has voted to permanently block access to Polymarket, an overseas blockchain-based prediction market platform that has drawn criticism as an illegal gambling service.

The commission held a meeting of its telecommunications review subcommittee Tuesday and issued the access-blocking order against Polymarket. The platform allows users to predict the outcomes of specific events — including US presidential election results, interest rate decisions, sports games and virtual asset prices — and wager money on those predictions using blockchain technology.

The commission determined that Polymarket's winner-takes-all profit structure promotes a gambling instinct, as users' financial gains and losses are determined entirely by the outcomes of events beyond their control, such as politics, economics, international relations, sports, elections and weather.

In reaching that conclusion, the commission considered three factors: that Polymarket's operators run and manage the platform as a whole, including opening markets and setting trading rules; that the platform creates an environment in which user funds are effectively pooled and distributed through a virtual asset deposit, withdrawal and settlement system; and that the operators collect fees on share transactions and derive economic benefit from them.

Polymarket pushed back, arguing that it does not fall under the scope of South Korea's Act on Promotion of Information and Communications Network Utilization and Information Protection. The company said the platform operates through non-custodial peer-to-peer transactions and smart contracts, meaning it does not qualify as a "host," and that it neither directly collects and manages funds nor issues sports promotion voting tickets — and therefore does not meet the requirements for violations of the Criminal Act, the National Sports Promotion Act or the definition of "gambling activity."

The commission shrugged off those arguments, saying the platform "cannot evade the application of domestic law on the grounds of technical characteristics or service methods, such as whether Korean-language service is provided, or decentralized or centralized technologies such as trading interfaces and order books." It added that blocking access "is unavoidable to protect domestic users, given that the platform is providing a de facto illegal gambling environment to users in South Korea."

Meanwhile, France blocked access to Polymarket in July, citing the platform's provision of illegal gambling services — including the potential to cause significant losses to users and the possibility that some bets could be manipulated.

Australia and Germany have also blocked the platform, each determining that it constitutes an illegal online gambling service or a form of betting not permitted under their respective laws.


ko@heraldcorp.com