Key highlights:
- The Czech Republic has moved to ban Polymarket, designating it as an unauthorized internet game
- ISPs have 15 days to geo-restrict the platform for residents in the country
- The FIFA World Cup has sent trading on prediction marketplaces to sky-high volumes
The Czech Ministry of Finance has added Polymarket to a list of unauthorized internet games, urging internet service providers (ISPs) to geo-restrict the popular
Per the memo, Polymarket and other firms are operating outside the Czech Republic’s gambling framework. The Czech Republic operates one of the strictest gambling rulebooks in the EU, marked by heavy taxation, a large security deposit, and swift ISP blocking of erring platforms.
“This is not about banning innovation,” said Jan Rehola from the Institute for the Regulation of Gambling. “It’s about ensuring that the same rules apply to everyone who offers betting for money.”
Unlicensed betting operators have cost Czech authorities over $15 million in tax revenue, with the country’s residents losing over $1 billion annually.
Several EU jurisdictions have also moved to ban Polymarket, citing a failure to adhere to local gambling rules. Belgium, Romania, Switzerland, Poland, Spain, Ukraine, and Germany have geo-restricted the prediction marketplace platform with Brazil following suit early in the year.
In the US, Polymarket’s international platform remains banned, but a federally-regulated Polymarket US app is available to consumers. Despite the wave of bans, users are turning to virtual private networks (VPNs) to sidestep the geo-restrictions in multiple jurisdictions.
Prediction marketplaces record sky-high volumes
Amid the regulatory pushback from authorities, trading volumes on prediction marketplaces have never been higher. In June, the combined monthly trading volume on Polymarket US, Polymarket, and Kalshi surged by 75% to settle at $44.8 billion.
Source: The Block Data Dashboard
Per the data, July is on course to dwarf the trading volumes recorded in June, buoyed by frenetic interest in the FIFA World Cup. Traders have poured over $50 million into the FIFA World Cup Golden Boot race, while bets for the tournament’s winners have attracted $4 billion.
However, CBOE has launched its first prediction market product linked to the S&P 500, touted to challenge the dominance of Kalshi and Polymarket. Meanwhile, crypto-native firms like Binance, Hyperliquid, and Crypto.com are inching toward the launch of their own prediction marketplaces to challenge the dominance of the industry firstmovers.
To cement their place, both Polymarket and Kalshi are expanding the scope of their offerings from retail prediction sites to full-service financial exchanges. However, a looming legal showdown with US states over regulatory jurisdiction threatens the long-term survival of prediction marketplaces.
Source:: Czech Republic Bans Polymarket Over Unlicensed Gambling As Prediction Markets Boom