France’s gambling regulator, l’Autorité Nationale des Jeux (ANJ), has imposed a geo-block on Polymarket.com, a crypto-based prediction market platform, over allegations of illegal gambling. The platform, operated by Web3 developer Adventure One QSS and licensed in Panama, has been restricted from serving users in France since November 21, 2024.
Illegal Games of Chance in Focus
ANJ monitored Polymarket throughout November, identifying concerns over its offerings, including online games of chance such as slots, which remain prohibited under French law. These activities prompted ANJ to contact Adventure One QSS, leading to the implementation of geoblocking measures to restrict access for French users.
French residents attempting to access Polymarket now encounter a pop-up message explaining the restriction. Despite this, reports indicate that users have managed to bypass the block by using virtual private networks (VPNs), raising concerns about the effectiveness of such measures.
In addition to gambling violations, Polymarket’s prediction markets—where users trade shares on event outcomes—have drawn scrutiny for potential insider trading. A particularly notable case involved a French trader, known as “Theo,” who allegedly placed bets between $28 million and $40 million on Donald Trump winning the 2024 U.S. presidential election. The volume of these bets sparked fears of market manipulation and heightened regulatory focus on the platform.
Broader Issues with Polymarket
Polymarket has faced similar legal challenges outside France. In 2022, the platform was fined $1.4 million by the U.S. Commodity Futures Trading Commission (CFTC) for operating without proper registration. Trading was temporarily halted following the penalty.
As of now, the ANJ has added Polymarket to its growing blacklist of over 944 URLs that violate French gambling laws. The regulator warns users about the risks of playing on unlicensed platforms, including potential identity theft, fraud, and non-payment of winnings.
“In general, the ANJ would like to warn people who play on illegal sites because they are exposing themselves to particularly serious risks,” the regulator said in a statement. It also advises players to consult its official list of licensed operators to ensure they are gambling legally.
Future of Online Slots in France
The Polymarket case arises at a time when France is reevaluating its stance on online gambling. In October 2024, the French government proposed an amendment to its 2025 budget, aiming to legalize online casino games, including slots. This move, supported by Budget Minister Laurent Saint-Martin, is set to undergo a six-month consultation in 2025.
While new legislation may take years to materialize, the consultation could pave the way for regulated online slots to launch by 2026. For now, ANJ remains firm in its enforcement of existing gambling laws, as demonstrated by its actions against Polymarket.
Challenges for Crypto-Based Platforms
Polymarket’s case highlights the difficulties crypto-based prediction platforms face in navigating regulatory landscapes. These platforms operate at the intersection of gambling, blockchain, and financial markets, often attracting scrutiny from multiple jurisdictions.
As Polymarket works to address compliance concerns in France, the broader question of how regulators manage crypto prediction markets remains unresolved. The platform’s ongoing engagement with stakeholders and adjustments to its offerings may shape its ability to operate within legal frameworks moving forward.
Source:
“French regulator blocks crypto operator Polymarket“, igamingbusiness.com, December 2, 2024.
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