Polymarket Dutch Ban Goes to Court Over Gambling Label

Polymarket is taking its fight with European gambling regulators to a courtroom. The company has confirmed to the Dutch financial daily Het Financieele Dagblad (FD) that it is challenging the Polymarket Dutch ban in court, Dutch public broadcaster NOS reported late on Sunday, October 4, 2026. Polymarket argues that its event contracts are financial instruments that should be supervised by the Netherlands Authority for the Financial Markets (AFM), not the gambling regulator that ordered it out of the country.

What happened

The dispute dates to February. On February 17, 2026, the Netherlands Gambling Authority (Kansspelautoriteit, or Ksa) announced an order subject to penalty payments against Adventure One QSS Inc., which operates the Polymarket brand, for offering games of chance in the Netherlands without a license. The order set a penalty of €420,000 a week, up to a maximum of €840,000, if the activity did not stop. The regulator also said a turnover-based fine could follow later.

"Prediction markets are on the rise, also in the Netherlands," Ella Seijsener, the Ksa's director of licensing and supervision, said at the time, adding that these companies offer bets that are not permitted on the Dutch market "even by license holders." According to NOS, Polymarket eventually complied but too late, so a €420,000 penalty became payable.

Bitcoin.com News, drawing on the Ksa's decision and the FD report, laid out the timeline. Polymarket says it switched on IP blocking on February 18, a day after the deadline expired, and the regulator moved to collect the €420,000 in May. In its objection, the company argued that users trade positions with each other through an open-source protocol on Polygon, with no house and with outcomes settled by an automated oracle, and pointed to U.S. Commodity Futures Trading Commission oversight of comparable platforms. The Ksa rejected that objection on June 23, quoting Polymarket's own help center, which describes the platform as a way to "profit from your knowledge by betting on future events." Ksa inspectors had earlier opened an account from a Dutch IP address, deposited €10 and bought a $1 "Yes" share in a market on the next Dutch prime minister.

Why it matters

The Polymarket Dutch ban case goes to the central legal question facing prediction markets worldwide: are event contracts bets or derivatives? In the U.S., the answer has split courts, with some judges finding sports event contracts likely to be swaps under federal law and many others siding with states. In Europe, the derivatives argument carries its own risk. NOS, citing the FD, noted that critics compare these contracts to binary options, in which an investor either wins a fixed amount or loses the entire stake, and that binary options are banned in most European countries because of their risks. Bitcoin.com News added that the EU's markets watchdog has warned that event contracts meeting the definition of financial instruments fall under existing restrictions on selling binary options to retail investors.

Legal experts are skeptical. Gambling lawyer Micha Schimmel told the FD that he gives the case little chance, citing a 2015 ruling that a service can be a financial product and still count as gambling, according to Bitcoin.com News. Dutch law bars betting on non-sports events even for licensed operators, and licensees cannot accept crypto because anonymous payment methods are prohibited, the Ksa said in its decision.

The Netherlands is not alone. NOS said Polymarket is also banned in countries including France and Germany, and Bitcoin.com News said the Ksa decision names Argentina, Australia, Belgium, Brazil, France, Hungary, Japan, Poland, Portugal and Spain as jurisdictions treating it as unlicensed gambling. U.S. lawmakers are scrutinizing the sector too, as Called It reported in the House Oversight letters on insider trading. The binary-options comparison is also live on regulated U.S. exchanges, as in Cboe's planned KPI binary options.

What's next

The court will decide whether the Ksa was right to treat Polymarket as an unlicensed gambling operator, and a ruling could take months. It is not known whether Polymarket has started similar proceedings elsewhere in Europe, NOS reported. Even a win would not automatically reopen the Dutch market: Polymarket would then have to satisfy financial-market rules under AFM supervision, including European restrictions on retail binary products. Meanwhile, the Ksa has kept open the option of a turnover-based fine. The outcome of the Polymarket Dutch ban challenge will be read closely by regulators in other EU countries weighing the same question.