Polymarket and other prediction markets are increasingly being banned worldwide. This includes South Korea, which explicitly banned citizens from trading on Polymarket from inside the country. Now, the nation has backed this ban with teeth.
Korean Police have booked 26 Polymarket traders and referred 18 of those cases to prosecutors on alleged illegal-gambling charges. Combined stakes reached 17.6 billion Korean won, or $12.7 million, according to figures the National Police Agency sent to Democratic Party lawmaker Yoon Kun-young. One trader’s book alone reached about 5.7 billion won, or $4.1 million. The Cyber Investigation Unit of the Gangwon Provincial Police Agency recorded those totals as of September 15.
Investigators say yes-or-no event contracts meet Article 246 of the Criminal Act because traders stake assets on outcomes they cannot control. Prosecutors now decide whether that theory supports indictments. The review follows an August 18 access block ordered by the Korea Communications Standards Commission, which called the venue an illegal gambling environment.
Law offices watching the files say the next weeks will show how far prosecutors push habitual-gambling penalties. Those penalties can reach three years in prison or a fine of up to 20 million won ($14,500). A basic finding can bring a fine of up to 10 million won. No indictment or court date has been announced.
Blockchain Traces Built the Case Without a Customer List
Police could not request a conventional account roster. The platform’s noncustodial blockchain design does not collect real-name records the way a licensed sportsbook would. So the cyber unit reconstructed activity from public blockchain transfers and paired those flows with open-source intelligence. You can read that as: they uncovered the owners of crypto wallets. Preliminary work began in March. Formal bookings started in May.
Asia Business Daily first published the booking and referral numbers drawn from the police packet. Later reports repeat the same totals and note that traders used political, economic, and social markets rather than a single sports slate. However, the market category is irrelevant to South Korea’s current prohibition. It hinges only on putting assets at risk on an unresolved event. What some would call gambling. The South Korean ban describes it that way.
Defense lawyers for those accused are already preparing a different story. Some argue that event contracts resemble derivatives because prices move and positions can be sold before settlement. Police reject that technicality line. They cite Korean Supreme Court language holding that staking property on an uncertain outcome can still count as gambling when skill plays a role.
Investigators treated winner-take-all payoffs and crypto settlement as the central detail. Defense counsel will argue chain traces cannot prove exclusive control of a wallet. If the referrals hold, other agencies watching event-contract volume will study the same method.
Access Block Did Not Close the Criminal File
Internet providers received the August 18 cutoff order after commissioners pointed to winner-take-all payouts, fee collection, and markets on events outside a trader’s control. But blocking access to Polymarket did not erase earlier on-chain activity. Investigators kept matching wallets to residents after the official ban took effect.
The same provincial unit had already been questioning traders after heavy June election-related volume. By late July, Polymarket had dropped Korean-language menus and reduced the visibility of domestic-topic markets. Local reporters treated that change as an obvious defensive step. The commission blocked access anyway.
Prosecutors now inherit a case built almost entirely from public chain data. That evidence can show flows. It does not automatically prove intent. And defense attorneys will also argue it doesn’t show individual control over those wallets. Prosecutors will have to close that gap if they want charges that survive a first hearing.
This is the first known application of gambling charges to Polymarket traders in South Korea. That status cuts both ways. Police gain an immediate serious enforcement headline. Meanwhile, judges inherit no clean local precedent for event-contract trading. Article 246’s habitual-gambling language will therefore carry unusual weight.
The possible penalties look small next to a seven-figure trading book, yet a conviction still brings a criminal record, follow-on asset questions, and more digging into financial records. That is why the referrals matter before any indictment appears. Investigators leaned on public records precisely because no conventional customer ledger exists. It remains to be seen how well that holds up in an actual court. If it holds, it could set a precedent for future actions against onchain traders.
References
- The Block — South Korean police charge 26 Polymarket users for illegal gambling
- BeInCrypto — South Korea Refers 18 Polymarket Users to Prosecutors Over $12.7M in Bets
- Wu Blockchain on X — South Korean Police Probe 26 Polymarket Users
- CoinCentral — Polymarket Users Face Prosecutors as Probe Escalates
- Bloomingbit — 18 Polymarket Users Referred to Prosecutors; Total Bets Reach $12.7 Million
- CryptoNews — South Korea Targets 26 Polymarket Users in $12.7M Betting Case
- Phemex News — South Korean Police Refer 18 Polymarket Users to Prosecutors
- Crypto Economy — Police Charge 26 Polymarket Traders for Illegal Gambling
