Indonesia bans Polymarket for illegal gambling

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The Backstory

Prediction markets collide with gambling laws

Indonesia’s move against Polymarket places the country in a widening group of jurisdictions treating prediction markets as gambling platforms rather than financial or information products. The distinction matters because Polymarket’s model allows users to take positions on real-world events, including politics, economics, sports and public affairs, often through cryptocurrency-based infrastructure that sits outside conventional gambling licensing systems.

Supporters of prediction markets argue that pricing on these platforms can provide a useful gauge of public expectations. Regulators have been less persuaded when real money is at stake. In several countries, authorities have concluded that a contract paying out based on a future event is functionally a wager, particularly when users are retail customers and the subject matter includes elections, inflation data or political instability.

Indonesia’s concern was sharpened by markets tied to domestic politics, including whether President Prabowo Subianto would remain in office for his full term. That pushed the issue beyond routine online betting enforcement and into a more sensitive area involving public order, political speculation and the risk that financial incentives could amplify destabilizing narratives.

India showed how access bans can lag activity

The Indonesian action follows a similar pattern seen in India, where regulators first warned that prediction market access was unlawful but then faced questions over whether platforms were still reachable. Complete iGaming previously reported that Kalshi and Polymarket continued operating in India despite government warnings, with Bloomberg cited as reporting that users were still able to register and trade.

India’s Ministry of Electronics and Information Technology described the services as “illegal and blocked prediction market and online betting platforms,” according to the report, and directed attention to virtual private network providers that could help users bypass restrictions. That created an enforcement challenge common to online gambling controls: a regulator may block domains, but users can seek alternate access through VPNs, mirror sites or other technical workarounds.

The Indian case then escalated. A later report said the government was moving to formally block Kalshi and Polymarket under a legal mechanism used for serious internet restrictions. The context was India’s Promotion and Regulation of Online Gaming Act, which separated permitted e-sports and non-monetary games from banned online money games. Prediction markets that allowed real-money trading on outcomes did not fit within the permitted categories.

That sequence is relevant to Indonesia because it shows how regulators often proceed in stages: first warning internet intermediaries, then issuing blocking orders and finally targeting circumvention channels. It also underscores the difficulty of applying national gambling laws to platforms that can operate across borders and rely on crypto rails or offshore infrastructure.

Argentina highlighted integrity risks

Argentina’s Polymarket case added another issue to the regulatory debate: market integrity. A Buenos Aires court ordered internet providers to block Polymarket after authorities found it was operating as an unlicensed betting service. Complete iGaming reported that an Argentinian court banned Polymarket for unlicensed gambling following an investigation by the city’s specialized gambling prosecution office.

The ruling focused on licensing and identity controls, but it gained broader attention because of wagers tied to Argentina’s monthly inflation rate. About US$91,000 in bets were recorded before official data was released, raising suspicions that some traders may have had access to confidential information. Even without proving wrongdoing, the episode illustrated why governments may be wary of prediction markets on official statistics, elections or policy decisions.

For regulators, such markets create two overlapping risks. The first is consumer protection: users may be betting in an unlicensed environment without the safeguards imposed on regulated gambling operators. The second is informational integrity: if traders can profit from early access to official data or political decisions, prediction markets may become a venue for exploiting leaks.

Indonesia’s concern about political markets sits in the same family of risks. A market on whether a leader remains in office may be framed by platform operators as forecasting, but to governments it can look like monetized speculation on instability. That perception is especially acute in countries where authorities closely manage political speech, public order and online content.

Asia-Pacific regulators are converging

Across Asia-Pacific, authorities have increasingly examined Polymarket through gambling, communications and consumer-protection frameworks. South Korea has not yet taken the same step as Indonesia, but its review shows the direction of travel. Complete iGaming reported that South Korea is reviewing whether Polymarket constitutes illegal gambling after a complaint to the Korea Communications Standards Commission.

The South Korean review is significant because Polymarket is available in the country and offers Korean-language service, according to local media outlet Bloomingbit. If a foreign platform is seen as targeting domestic users, regulators may assert jurisdiction even when servers, corporate entities or technical infrastructure are based elsewhere.

The report also noted that multiple Asia-Pacific jurisdictions, including Singapore, Thailand, Australia and New Zealand, have taken action against Polymarket or similar services. That regional context matters for Indonesia. Regulators rarely act in isolation when cross-border digital products are involved. Once several jurisdictions classify a product as illegal gambling, others can point to those precedents when defending domestic blocks.

Polymarket’s history in the United States also weighs on overseas assessments. The U.S. Commodity Futures Trading Commission charged the company’s parent in 2022 with operating an unregistered trading platform, after which Polymarket settled, wound down noncompliant markets and blocked U.S. users. Its later U.S. re-entry under a regulated structure did not erase the core question facing other countries: whether event contracts should be regulated as financial derivatives, gambling products or something else entirely.

Indonesia’s broader crackdown set the stage

The Polymarket block did not emerge in a vacuum. Indonesia has been running a broader campaign against illegal online gambling, combining access restrictions, financial monitoring and law enforcement. Complete iGaming previously reported that Indonesia recorded a decline in online gambling activity in 2025, with authorities attributing the drop to tighter enforcement.

Data from the Financial Transaction Reports and Analysis Center showed online gambling turnover through the third quarter of 2025 reached IDR 155 trillion, down 57% from 2024. Participation also fell, with the number of online gambling players dropping to 3.1 million from 9.7 million. Communication and Digital Affairs Minister Meutya Hafid said the figures showed that monitoring, access blocking and enforcement were having an effect.

Those numbers help explain why Indonesian authorities would be inclined to treat Polymarket as part of the same enforcement universe rather than as a separate financial technology product. If the government believes its anti-gambling campaign is producing measurable declines, allowing a high-profile crypto-based prediction market to remain accessible could undermine that effort and create a perceived loophole.

The stakes extend beyond one platform. A successful ban signals to internet providers, app stores, payment channels and crypto intermediaries that Indonesia expects active compliance with gambling restrictions. It also gives regulators a basis to move against similar event-contract platforms if they offer Indonesian users markets on politics, sports or public affairs.

The unresolved question is classification

The global dispute over Polymarket and its peers remains rooted in classification. Operators want prediction markets viewed as tools for forecasting and, in some cases, as regulated event-contract markets. Gambling regulators see users staking money on uncertain outcomes for a potential payout. Communications authorities see offshore websites reaching domestic consumers. Financial watchdogs see instruments that may resemble derivatives but lack the safeguards of regulated exchanges.

Indonesia’s decision adds pressure on the industry because it targets the platform’s practical accessibility rather than waiting for a global consensus. The same approach has appeared in India, Argentina and other markets: if a service looks like gambling under local law and lacks a domestic license, regulators can order it blocked.

That leaves prediction market companies with a narrowing set of options. They can seek licenses where regimes allow them, restrict access in prohibited markets, redesign products to avoid real-money wagering or continue contesting the gambling label. The more governments that adopt Indonesia’s view, the harder it becomes for platforms to argue that prediction markets can operate globally under a single regulatory theory.