South Korean authorities have advanced a criminal investigation into domestic users of the prediction market platform Polymarket, booking 26 people on suspicion of illegal gambling and referring 18 of them to prosecutors. The cases involve combined wagers totaling about 17.6 billion won, equivalent to roughly $12.7 million.

Data from the National Police Agency, shared with the office of lawmaker Yoon Kun-young, show that the Gangwon Provincial Police Agency’s Cyber Investigation Unit handled the matter. As of September 15, investigators had formally booked the 26 users. One individual accounted for the largest volume, placing stakes of approximately 5.7 billion won, or about $4.1 million.

How Investigators Identified Users

Police began preliminary inquiries in March and moved to formal bookings starting in May. Because Polymarket operates as a non-custodial peer-to-peer platform without a conventional real-name customer list, officers relied on publicly available blockchain transaction records and open-source intelligence tools to link activity to individuals.

The published materials do not list specific wallet addresses, limiting independent verification of the reported totals. Authorities stated that the absence of a traditional user registry did not prevent identification once on-chain data were analyzed.

Legal Basis for the Charges

Investigators apply Article 246 of South Korea’s Criminal Act. The provision allows a fine of up to 10 million won for gambling and, for habitual activity, imprisonment of up to three years or a fine of up to 20 million won. Police cite a 2008 Supreme Court ruling that gambling exists when property is staked on an outcome the parties cannot certainly predict or freely control, even if skill plays some role.

In the view of the Cyber Investigation Unit, Polymarket activity satisfies those elements when users commit digital assets to event contracts and either receive settlement proceeds or lose their stake based on an uncertain result. Similarities to derivatives trading or the lack of a dedicated regulatory guideline do not, according to police, automatically remove the conduct from the gambling statute.

Attorney Kim Tae-rim of AXIS Law noted that courts may examine structural features such as order-book trading and the ability to exit positions before maturity. He observed that the contracts fall outside the existing Capital Markets Act framework, which limits the usefulness of that statute as a direct criminal defense.

Platform Access Already Restricted

The individual cases follow a separate regulatory action. On August 18, South Korea’s Broadcasting, Media and Communications Review Committee ordered domestic internet service providers to block access to Polymarket. The committee concluded that the platform supplied an illegal gambling environment through markets tied to politics, economics, sports, elections and weather.

Regulators pointed to the winner-takes-all settlement structure, the platform’s role in setting market rules and providing settlement infrastructure, and the economic benefit it derives from activity. Polymarket had argued that its non-custodial design, absence of Korean-language services and lack of Korean won payments should place it outside local gambling rules. The committee rejected that position, stating that technical characteristics or service structure do not exempt a platform from domestic law.

The August decision came after an earlier hearing process in which regulators postponed a final ruling to allow the platform additional time to present its case.

Separate Structures for U.S. and International Operations

Polymarket maintains that its international platform and its U.S. business operate through separate legal entities. The international version is not regulated by the U.S. Commodity Futures Trading Commission. The U.S. venue, operated through QCX LLC doing business as Polymarket US, holds designation as a contract market dated July 9, 2025.

South Korean investigators have grounded the current cases solely in domestic criminal law. The media review committee has likewise maintained that a platform’s technical or organizational structure cannot by itself prevent application of Korean statutes.

No court ruling has yet determined whether the order-book probability contracts fall outside Article 246 because of their claimed derivatives-like features. Eighteen case files have been transmitted to prosecutors. Published police materials do not report any indictment decisions, trial dates or judgments at this stage.