Key insights
- Polymarket is not just appealing the penalty. It is actively challenging the Ksa’s classification of its platform as gambling.
- If Dutch authorities decide that the contracts, on Polymarket qualify as options new compliance requirements could arise.
- This ruling might set a precedent that affects how other European regulators view prediction markets.
Polymarket will challenge the Netherlands’ gambling ban in court after the Ksa upheld a €420,000 enforcement penalty. The case could determine whether prediction markets belong under gambling rules or financial-market regulation across Europe.
The dispute centers on Polymarket’s classification as an unlicensed gambling service. The company argues that its event contracts function as financial products and should fall under the Dutch Authority for the Financial Markets, or AFM.
Ksa launches enforcement against Polymarket
The Dutch Gambling Authority, or Ksa, issued its enforcement order on Jan. 20 and published it publicly on Feb. 17. It concluded that Adventure One QSS Inc., identified as Polymarket’s operator, offered gambling services to Dutch users without a license.
Polymarket goes to court to overturn Dutch gambling ban https://t.co/ZLHrDeVCPv https://t.co/S85bLFCklT
— DutchNews.NL (@DutchNewsNL) October 5, 2026
The regulator ordered the company to stop serving the Netherlands. It attached a €420,000 penalty for each week of continued activity, with the total capped at €840,000.
A Ksa inspection on Feb. 18 found that Dutch users could still access the platform. Polymarket disputed the finding and said it had begun blocking Dutch IP addresses that day.
The company later filed an administrative objection against the enforcement order. However, the Ksa rejected that objection on June 23 and maintained its original decision. By July, the regulator said one €420,000 penalty had become payable. It also began collection proceedings after Adventure One failed to pay the amount.
Polymarket subsequently told Dutch media that it would take the dispute to an administrative court in The Hague.
Polymarket disputes that it should be classified as gambling
Polymarket says that its contracts are different from betting products. People trade positions that are connected to events and the prices of the contracts are set by what the market wants.
The company says people can look at information and decide when to trade and leave their positions before they are settled. Because of this it says the activity is like derivatives markets than regular gambling.
The Ksa did not agree with that difference during its review. The regulator said that when people participate in a peer-to-peer way, it does not automatically mean the activity is not part of the gambling rules.
The authority compared prediction markets with betting exchanges and certain poker formats. In those markets, participants can compete against each other while an operator provides the platform.
The Ksa also raised concerns about cryptocurrency payments. Dutch gambling licensees must use payment methods that allow regulators to identify players and track transactions.
Polymarket now lists the Netherlands among countries where access remains completely restricted. The company also prohibits users from bypassing geographical restrictions through VPNs.
Financial rules create another regulatory conflict
Polymarket’s push for financial regulation faces a separate issue involving binary options. The AFM prohibits the marketing, distribution and sale of binary options to retail investors in the Netherlands.
The CFTC, meanwhile, regulates Polymarket’s U.S. operation through QCX LLC. CFTC records identify the company as a designated contract market.
Several Polymarket US contracts also appear in CFTC filings under the classification of swap or binary option products. However, the U.S. operation and the international platform face different legal frameworks.
That distinction could become important during the Dutch court case. A ruling that treats Polymarket contracts as financial products would not automatically establish that the AFM must approve them.
Dutch regulators would still need to determine whether individual contracts meet financial-product requirements. The case therefore extends beyond the original €420,000 penalty.
Dutch case could shape European prediction markets
The court challenge comes as European regulators take different approaches to prediction markets. France, Spain and the Czech Republic have also acted against prediction sites.
Meanwhile, a few states have begun work on specific regulations. Gibraltar has passed a set of regulations aimed at prediction markets and Malta has indicated interest in a similar set of regulations.
There was also a discussion in the Netherlands about whether or not a special framework of oversight for prediction markets is required. State Secretary Claudia Van Bruggen opposed a proposal for specific oversight.
In the meantime, Polymarket has been continuing to pursue a position for some of the European products in the financial market. The company has been having discussions on MiFID treatment and overall European regulation.
The Dutch court case might thus set an important precedent for the definition of an event contract in Europe.
Conclusion
Gambling’s regulatory issues come head-to-head with financial-market surveillance at Polymarket’s court case. The Ksa claims that prediction contracts are nothing more than unlicensed gambling, whereas Polymarket believes that the trading of this kind should be subject to financial regulation.
The court’s ruling might shed light on the legal position of prediction markets in the Netherlands. It could also shape the approach of the regulators in the fast-growing industry in Europe.
