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Gambling regulator raises legal concerns as significant bets on political outcomes bring platform under scrutiny.
Author: Carol Cram
Key Takeaways
Polymarket has come under scrutiny from France's gambling regulator. Polymarket has facilitated over $3.2 billion in bets, raising legal concerns in France. <?xml encoding="UTF-8"?>France is considering restricting access to Polymarket amid concerns over unlicensed gambling activities, as reported by The Big Whale, a French web3-focused publication, on Wednesday.
Polymarket’s model of betting on future events using crypto aligns with the definition of gambling under French law. This classification subjects the platform to strict regulations and potential bans.
“Even if Polymarket uses cryptocurrencies in its operations, it remains a betting activity and this is not legal in France,” said a source close to the Autorité Nationale des Jeux (ANJ), also known as the National Gambling Authority, which oversees all forms of gambling in the country.
Polymarket, which has raised $74 million from venture capital funds and crypto figures including Ethereum co-designer Vitalik Buterin since its 2020 launch, saw over $3.2 billion in bets placed on the US presidential election. The platform recorded $294 million in trading volume on November 5 alone, according to data from Dune Analytics.
William O’Rorke, partner at ORWL Avocats, noted that the ANJ has the authority to block Polymarket’s operations in France, despite the platform not specifically targeting French users.
The regulator’s attention was drawn by a French trader who placed more than $30 million in bets on a Trump victory, with potential net profits of around $19 million, the report stated.
The ANJ told The Big Whale that they “are currently examining its operation as well as its compliance with French gambling legislation.”
Polymarket is inaccessible to US users following its settlement with the Commodity Futures Trading Commission (CFTC) in early 2022.
As part of the settlement, the platform paid a $1.4 million fine for operating as an unregistered trading platform. It also agreed to cease operations for US residents and citizens.
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