Polymarket launches legal challenge against €420,000 penalty in the Netherlands
The prediction market platform claims that it aimed to meet the deadline given to block access in the Netherlands.
Key takeaways:
- Polymarket is challenging a €420,000 Dutch regulatory fine, arguing that it acted in good faith to block Dutch users and that any access after the February 17 deadline was a temporary technical result of implementing the restriction, rather than deliberate non-compliance.
- The case reflects a wider debate over how prediction markets should be regulated in Europe, with Dutch authorities maintaining that such products fall under existing gambling laws and rejecting calls for a dedicated regulatory framework.
The Netherlands.- The prediction market operator Polymarket has launched a legal challenge in The Hague against a €420,000 penalty imposed by the Dutch gambling regulator, Kansspelautoriteit (KSA). The fine was issued due to the operator allegedly providing unlicensed gambling services to customers in the Netherlands for one day after a deadline that it had set.
Early this year, the KSA blacklisted Polymarket and warned its parent company, Adventure One, that financial sanctions would follow unless access to the prediction markets platform was blocked for Dutch users by February 17. Polymarket eventually complied, but the KSA informed Adventure One in May that it intended to proceed with the penalty, arguing that the platform only withdrew from the Dutch market on February 18, one day after the deadline had passed.
The KSA subsequently stated that it would begin recovery and enforcement proceedings after the penalty remained unpaid by Adventure One. Polymarket argues that work to implement the access block had already begun on February 18 and that any continued availability during testing was a technical consequence of the rollout process rather than a failure to comply.
“Adventure One QSS Inc. states that this is not negligence, but a known feature of the technology, and that the measures have been implemented as quickly and carefully as possible within the short grace period,” it claims.
Controversy over the regulatory status of prediction markets has rapidly spread across Europe after the initial concentration in the US, where states contest the Commodity Futures Trading Commission’s claim that event contracts are financial instruments under its purview.
Dutch MP Iem Al Biyati recently submitted a motion to the House of Representatives seeking the creation of a dedicated regulatory framework for prediction markets. However, the proposal was rejected by State Secretary Claudia Van Bruggen, who pointed to the KSA’s position that such products fall within the scope of gambling legislation.
Elsewhere in Europe, regulators have largely maintained restrictive positions towards the sector with the exception of Gibraltar, which leapt on the prediction market space as a potential way to make up for the likely impact of the UK Remote Gaming Duty rise on its igaming sector. It granted Abu Dhabi-based ADI Predictstreet a gambling licence ahead of the FIFA World Cup this year and subsequently switched the operator to a new dedicated regime for prediction market platforms.
Kalshi has stated that it is holding discussions with major European regulatory bodies, including the European Securities and Markets Authority (ESMA), regarding the future of the sector within the EU.
Meanwhile, a Dutch study has raised concerns about the role of generative artificial intelligence tools in directing consumers towards unlicensed gambling websites. The research, carried out by XY Legal Solutions between August and September 2026, examined how 10 leading AI-powered assistants responded to gambling-related queries submitted in Dutch.
Researchers designed the experiment around realistic consumer interactions, testing three different categories of questions. These included general enquiries such as asking for the best online casinos in the Netherlands, requests specifically seeking casinos operating without Cruks, the country’s mandatory self-exclusion register, and questions framed as academic research rather than gambling advice. Each platform was asked a series of follow-up questions under each scenario. Researchers then recorded how quickly the AI tools identified gambling brands that did not possess an online gambling licence issued by the Dutch regulator, the KSA, as of September 1.
According to the findings, every AI system tested mentioned at least one unlicensed operator by name or website address during at least one conversation. Eight of the 10 platforms identified unlicensed operators in response to neutral or leading questions, even when users did not explicitly state an intention to conduct research.
