French gambling regulator Autorite Nationale des Jeux (ANJ) is currently investigating the operations of Polymarket, a crypto-based prediction market that gained attention after a French national successfully bet on Donald Trump winning the U.S. election.
The ANJ, also known as the National Gambling Authority, stated that they are examining Polymarket’s operations to ensure compliance with French gambling laws. The platform, which saw a surge in betting volumes during the recent U.S. presidential election, is facing scrutiny from regulators.
According to a spokesperson from the ANJ, the use of cryptocurrencies in Polymarket’s operations does not exempt it from being classified as a betting activity, which is illegal in France. The regulator is expected to take action against the platform soon, as reported by French-language crypto news outlet The Big Whale.
The investigation follows the success of a French individual named Theo, who made significant profits by betting on Trump’s victory on Polymarket. Despite initial predictions suggesting a close race between Trump and Kamala Harris, Theo’s bets proved to be correct, earning him an estimated $50 million in profits.
Polymarket operates by allowing traders to buy and sell shares representing potential outcomes of future events. Each share pays out in the USDC stablecoin based on whether the prediction comes true or not. The platform, based in New York, is not accessible to American users and has been blocking U.S. IP addresses due to regulatory issues with the Commodity Futures Trading Commission.
While proponents of prediction markets argue that they provide a more accurate forecasting method than traditional polls or punditry, election betting remains a controversial topic in many countries. The CFTC in the U.S. has been considering regulations to prohibit such activities on exchanges under its jurisdiction.
Despite facing regulatory challenges, Polymarket continues to attract a global audience interested in participating in prediction markets. The platform’s success and the recent scrutiny from French regulators highlight the evolving landscape of crypto-based gambling and prediction markets.
As the investigation into Polymarket’s operations unfolds, the outcome will shed light on the future of prediction markets and regulatory oversight in the crypto industry. The controversy surrounding the platform’s success in predicting the U.S. election outcome underscores the challenges and opportunities facing the intersection of cryptocurrencies and online betting platforms.
