Portugal's prediction market regulation tightened, Polymarket ordered to cease services within 48 hours

The blockchain-based prediction market platform Polymarket(Polymarket) has become subject to enforcement actions by Portuguese regulatory authorities. On January 20, PANews reported, citing CoinDesk, that Portugal’s gambling regulatory agency SRIJ ordered Polymarket to fully cease its services within Portugal within 48 hours.

Election Vote Surge and Rapid Response by Regulatory Authorities

This strict action was carried out surprisingly quickly. On January 18, market interest in the Portuguese presidential election results exploded on Polymarket, with over €103 million(approximately $120 million) in prediction bets concentrated on the platform within just 48 hours. This drew enough attention from regulators.

Portugal’s SRIJ responded swiftly, and the reason is clear. Polymarket does not hold any local operating licenses for betting and prediction markets. From the regulator’s perspective, it was essentially operating illegally.

Clash with Portugal’s Strict Betting Regulations

Portugal’s gambling regulatory framework is quite restrictive. Local laws only legally permit sports betting, casino games, and horse racing bets, explicitly prohibiting betting on real-world events such as political elections. Polymarket’s prediction market for the presidential election directly violated these laws.

As blockchain-powered prediction markets spread worldwide, regulatory authorities in various countries are contemplating how to classify this new form of financial activity under existing gambling and betting regulations. Portugal’s recent action exemplifies an effort to clearly categorize prediction markets within the existing betting category.

Technical Blocking and the Platform’s Future

Currently, Polymarket is technically accessible within Portugal. However, regulatory authorities have the authority to soon compel internet service providers to block access to the site. This could effectively prevent ordinary users from accessing the platform, excluding circumvention via VPNs or other means.

Portugal’s regulatory decision foreshadows the challenges that global prediction market platforms may face under different European regulatory environments. While blockchain’s transparency and accessibility are advantages, conflicts with national financial regulations appear unavoidable.