Report: Taiwanese Authorities Investigate Polymarket Election Contract, Looking Into Blockchain Betters

Betting on election outcomes is expressly forbidden under Article 88-1 of Taiwan’s Presidential and Vice Presidential Election and Recall Act.

The law stipulates that individuals gambling on election or recall outcomes in public places or areas accessible to the public can face up to six months’ imprisonment, short-term detention, or a fine of up to NT$100,000 ($3,196.85).

Sherman Lin, an attorney at Lin & Partners in Taipei, emphasized to CoinDesk that Taiwan’s law enforcement rigorously investigates any election-related gambling activities. The expansive legal interpretations within the Presidential Election and Recall Act have led to investigations and convictions of gambling website operators targeting Taiwanese bettors.

Gambling on election results is largely prohibited across the U.S., including Nevada, with the Commodity Futures Trading Commission (CFTC) primarily handling enforcement.

Polymarket’s Terms of Use restrict usage by U.S. individuals. KalshiEX, a prediction market, has taken legal action against the CFTC for prohibiting its proposed derivatives contracts involving bets on congressional control. They argue that these contracts are legal and serve the public interest by facilitating risk management and offering predictive insights.

While participation in, promotion of, and hosting platforms like Polymarket are illegal in Taiwan, legal enforcement against the platform itself is challenging due to its decentralized nature and location outside of Taiwan.

“Due to Polymarket’s decentralized structure and lack of physical presence in Taiwan, the judicial system’s ability to directly target the platform might be limited,” Lin explained, “leading law enforcement to prioritize targeting online influencers who promote the contract.”

“Recent cases show Taiwanese prosecutors pursuing online influencers for endorsing trading platforms, indicating potential legal consequences for promotional engagements,” he elaborated.

Following the collapse of the unlicensed crypto exchange JPEX in Hong Kong, law enforcement detained multiple online influencers who had endorsed the platform.

Lin also noted the existing legal basis to pursue centralized entities facilitating election gambling but highlighted the absence of established legal precedents in Taiwan for decentralized platforms orchestrating election betting.