PolyMarket’s updated approach combines technical barriers with selective identity checks to let users avoid location restrictions. The company reportedly completely blocks known VPN IP ranges and flags accounts that show signs of theft. Users with unusually large positions or moving funds in rapid, high-value cycles now receive requests to complete identity verification to meet anti-money laundering regulations. While basic wallet-based trading is used usdc stablecoin While Polygon remains open to people in permissioned regions on the blockchain network, the platform has moved away from completely permissionless access by default, which is a key feature that differentiates the international version of its platform from its main rival Kalashi. Of course, this trend towards more permissive forms of access is increasingly being seen throughout the crypto industry in general, as is much of the activity associated with it. Being built around stablecoins and other points of centralization.
Notably, Polymarket keeps its international operations separate from its US branch, which requires Know Your Customer compliance after the company acquires a licensed derivatives exchange in 2025. Prior to this acquisition, the prediction markets provider had also signed a $1.4 million settlement with the CFTC through 2022 for unregistered binary options operations.
Geoblocking specific IP addresses is a common method of preventing people in restricted countries from accessing financial platforms that lack proper regulatory approval or compliance in those regions. Yet VPNs also let anyone route their connection through servers in permitted locations, making pure IP-based blocks unreliable without collecting personal details about users. This limitation of geoblocking has been exploited by crypto exchanges before. Both Binance and KuCoin faced heavy criticism and formal charges for letting Americans trade without the required KYC and AML checks. court documents show KuCoin knowingly allowed US customers to operate without identity verification, advertised the lack of KYC as a convenience and took steps to hide their presence. CFTC has also pointed to Cases where Binance gave guidance to US users on how to use a VPN to avoid detection.
Regulators around the world are increasingly disputing how prediction markets should be classified, with some considering them unlicensed gambling and others seeing them as unauthorized derivatives trading. Spain recently instructed internet providers to block both Polymarket and Kalshi After the platforms operated without the required gambling licenses and failed to include adequate protections for minors and self-excluded bettors. The blocks will remain in place during the disciplinary proceedings, which are expected to last three to four months.
Spain’s decision brings the total to more than 30 jurisdictions where prediction markets face restrictions or a complete ban. Recent additions to that list include Indonesia, which took action earlier this week, as well as Argentina, Brazil, India, France, Belgium, Australia and the United Kingdom. In the United States, the CFTC filed a lawsuit against Minnesota after the state passed a law criminalizing prediction markets. Kalshi also has joined the challenge Its own federal lawsuit argues that the Minnesota law exceeds state authority and violates the Constitution by interfering with federally supervised derivatives markets.
At the same time, some jurisdictions have begun exploring stricter regulations on VPNs when people use them to bypass age-based limits on adult content and other forms of online regulation. The focus so far has been on placing legal responsibility on app developers and website operators, forcing them to prevent unauthorized access by targeted groups. critic, such as the Electronic Frontier Foundationwarned that this approach would push platforms toward requiring real-world identity verification for users, effectively eliminating anonymous Internet access for many services.
Utah’s new online age verification amendments prevent companies hosting content harmful to minors from helping users bypass age verification through VPNs or similar tools and hold the platforms accountable for access attempts from within the state, regardless of masking technology. Similar discussions have also emerged in the United KingdomWhere authorities have described VPNs as having loopholes that undermine content restrictions.
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