The Dutch gambling regulator Kansspelautoriteit (KSA) has rejected an appeal filed by Polymarket regarding a sanction for operating without a license. The decision upholds a previous order requiring the prediction platform to cease activities in the Netherlands or face financial penalties.
Operator Adventure One QS lodged the appeal in March, contesting the regulator's classification of the platform. The company argued that Polymarket functions merely as an interface for the Polygon blockchain protocol rather than a gambling service. They claimed users trade peer-to-peer positions via crypto wallets, which they believe falls under financial product regulation in certain cases.
Regulatory Decision and Evidence
The KSA dismissed these arguments, concluding that the element of chance defines the service as gambling under Dutch law. The regulator noted that the platform offers users opportunities to wager on future event outcomes. Furthermore, the KSA pointed to Polymarket’s own marketing materials, which explicitly use the term "betting", contradicting the operator's defense.
During the initial investigation, the regulator found the platform was actively targeting Dutch residents. Users with local IP addresses could register, and the service provided a Dutch-language AI chat function. The platform also hosted markets dedicated to Dutch politics and sports, despite wagering on political events being prohibited in the region.
Financial Penalties and Transparency
The original sanction, issued in February, warned of fines reaching €420,000 per week, with a maximum cap of €840,000. Adventure One QS had missed the initial compliance deadline of February 17, implementing IP-blocking measures only the following day. The operator also requested a refund of legal costs and argued the sanction was disproportionate.
The regulator affirmed that it had properly communicated the legal basis for the order and considered all submissions. Additionally, the KSA defended its decision to publish the enforcement action publicly. Polymarket’s parent company had previously complained that naming the platform was unfair, but the regulator cited its rights under the Dutch Open Government Act.