What is Polymarket?

Disclaimer (Netherlands): Polymarket has been classified by the Dutch Gambling Authority (Kansspelautoriteit, Ksa) as illegal gambling without a license. Since the enforcement action in February 2026, using Polymarket from the Netherlands is prohibited. This article is for informational purposes only.

Polymarket

Polymarket is an online prediction market where users speculate on the outcome of future events. Instead of traditional betting, the platform revolves around markets in which prices indicate how likely a certain event is to occur. Polymarket uses blockchain technology and cryptocurrencies, which distinguishes it from more traditional alternatives.

As Polymarket is increasingly mentioned in the news and on social media, interest has also grown in the Netherlands. At the same time, the platform raises questions about how it works, its risks, and its legal status. In this article, you will learn what Polymarket is, how it works, and what Dutch users should take into account.

In short

• Polymarket is a prediction market focused on real-world events.

• Users trade outcomes using cryptocurrencies.

• Market prices reflect probability estimates.

• Blockchain and smart contracts handle settlement.

• The legal status differs by country, including the Netherlands.

What is Polymarket?

Polymarket is a platform where markets are created around specific questions about the future. These questions usually have a clear outcome, such as yes or no. Users can take positions by buying or selling tokens linked to an outcome.

The idea behind Polymarket is that the collective expectations of participants are reflected in a single price. When new information becomes available, prices move accordingly. This creates a dynamic picture of what the market expects to happen.

How does Polymarket work?

Polymarket operates through separate markets, each representing a specific question. Users can speculate on an outcome by opening a position. This is done using cryptocurrencies rather than euros or traditional currencies.

Price as a probability estimate

The price of an outcome reflects the probability the market assigns to it. A price of 0.65 suggests participants estimate a roughly 65% chance that the outcome will occur. These prices change continuously based on supply and demand.

Market settlement

When a market closes, the outcome is determined according to predefined criteria. Settlement happens automatically via smart contracts on the blockchain. Users holding the correct outcome receive their payout according to the rules set in advance.

What types of predictions are possible on Polymarket?

Polymarket mainly focuses on current and societal topics, such as political elections, economic indicators, regulation, or technological developments. The focus is on topics where substantial information exists and where different expectations can be reflected in market prices. Not every prediction is allowed — markets are reviewed in advance and must follow the platform's guidelines.

The role of blockchain and cryptocurrencies in Polymarket

Blockchain technology forms the technical foundation of Polymarket. This enables transparency and an automated process without a central intermediary.

Smart contracts and transparency

Smart contracts define how markets function, when they close, and how payouts are handled. Because these contracts exist on the blockchain, they can be publicly verified, contributing to the transparency of the process.

Why cryptocurrencies are used

Polymarket uses cryptocurrencies because they can be directly integrated with smart contracts. They also allow international participation without relying on traditional payment systems. Users typically need a compatible crypto wallet to participate.

Polymarket in the Netherlands

For Dutch users, the legal context is particularly important. Regulation around gambling and financial products in the Netherlands is strict and complex.

Legal context

Polymarket positions itself as a prediction market rather than a traditional betting platform. However, there are overlaps with existing gambling regulations. The Dutch Gambling Authority (Ksa) has concluded that Polymarket offers gambling services without a license and has ordered the platform to stop targeting Dutch users.

Is Polymarket legal?

The legality of Polymarket differs by country and depends on local regulation and interpretation by authorities.

In the Netherlands, Polymarket has been classified by the Dutch Gambling Authority as illegal gambling without a license. This means using Polymarket from the Netherlands is prohibited.

Authorities in other countries have also imposed restrictions on prediction markets. This shows that regulation for this type of platform is still evolving and can vary significantly between jurisdictions.

How does Polymarket make money?

Polymarket generates revenue through transaction fees charged when users open or close positions. These fees are part of the trading process and help maintain the platform's operations.

Advantages and disadvantages of Polymarket

An advantage of prediction markets is that prices can provide insight into collective expectations. Blockchain technology can also support transparent settlement. Disadvantages include legal uncertainty (depending on the country) and the complexity of working with crypto wallets and cryptocurrencies.

Risks and responsible use

Prediction markets involve risks. Markets can move quickly and outcomes are uncertain. Using cryptocurrencies also requires technical understanding and careful attention to security. Responsible use starts with understanding how the platform works and what risks are involved.

Frequently asked questions

How does Polymarket work?

Polymarket uses markets where users buy or sell positions based on expected outcomes. Prices reflect probability estimates and settlement happens automatically through smart contracts.

Can you use Polymarket in the Netherlands?

No. In the Netherlands, Polymarket has been classified as illegal gambling without a license by the Dutch Gambling Authority, and using the platform from the Netherlands is prohibited.

Please be aware Yield Services are currently not covered by the Markets in Crypto-Assets Regulation (MiCAR) or any other sectoral EU legislation. This means the service does not offer the same safeguards as MiCAR-regulated services that Coinmerce offers.