South Korea’s Gangwon Special Self-Governing Province Police Agency said it identified 26 Polymarket users suspected of illegal gambling through blockchain transaction analysis, referred 18 of them to prosecutors, and traced a combined $12.7 million in wagers.

The investigation was led by the police agency’s Cyber Investigation Department under Article 246 of South Korea’s Criminal Code. According to the disclosed case details, the combined amount wagered by the 26 users reached about $12.7 million, while the largest single user bet was reported at $4.1 million.

Police said they began a preliminary investigation in March and formally opened the case in May. The transactions under review took place while South Korean users still had normal access to Polymarket. On Aug. 18, the South Korean Communications Commission ordered the platform to be blocked.

Supporting reports describe the matter as South Korea’s first criminal investigation targeting Polymarket users. The legal issue centers on whether activity on the prediction market should be treated as illegal gambling because users stake assets on uncertain outcomes, or whether it should be viewed more like a crypto-based derivatives or investment market.

Authorities have so far focused on individual user conduct rather than announcing direct criminal action against Polymarket itself. Still, the combination of platform blocking and user referrals shows that the matter has moved beyond a preliminary compliance question into active enforcement.

Why It Matters

The case is an important signal for crypto-linked prediction markets operating across borders. In South Korea, the enforcement path appears to be running through gambling law rather than through a narrower crypto or securities framework, which could widen legal exposure for both users and platforms offering event-based markets.

It also underlines a broader market-structure point: on-chain settlement does not eliminate jurisdictional risk. Even where platforms operate offshore or without conventional custody, local authorities may still pursue users if they can link public blockchain activity to alleged violations under domestic law.