Taiwanese Authorities Investigating Blockchain Betters over Polymarket Election Contract: Report

Those
looking
to
make
a
quick
buck
betting
on
Taiwan’s
upcoming
election
may
want
to
think
twice,
as
local
law
enforcement
is
currently
investigating
online
influencers
and
community
members
promoting
a
Polymarket
contract
about
the
nation’s
upcoming
election.

Taiwan-based

BlockTempo
reported
that
multiple
influencers
and
individuals
in
the
crypto
community
have
been
subpoenaed
for
their
participation
in
Polymarket
contracts
that
let
users
bet
on
the
outcome
of
the
January
election.

There’s
currently
over
$300,000

bet
on
a
contract
regarding
the
outcome
of
the
election,
with
the
market
giving
the
Democratic
Progressive
Party’s
Lai
Ching-te,
also
known
as
William
Lai,
a
78%
chance
of
winning.

Betting
on
the
outcome
of
an
election
is
specifically
prohibited
under
Article
88-1
of
Taiwan’s
Presidential
and
Vice
Presidential
Election
and
Recall
Act.

“A
person
who
gambles
in
a
public
place
or
a
place
open
to
the
public
on
the
outcome
of
an
election
or
recall
shall
be
sentenced
to
fixed-term
imprisonment
of
not
more
than
six
months,
short-term
detention
or
a
fine
of
not
more
than
NT$100,000
($3,196.85),”
the
law
reads.

“Law
enforcement
agencies
in
Taiwan
are
vigilant
in
investigating
any
gambling
activities
related
to
presidential
elections,”
Sherman
Lin,
an
attorney
at
Taipei-based
Lin
&
Partners
told
CoinDesk
in
an
interview.
“Broad
legal
interpretations
have
been
applied
to
gambling
crimes
under
the
Presidential
Election
and
Recall
Act,
leading
to
investigations
and
convictions
of
gambling
website
operators
in
Taiwan
targeting
Taiwanese
gamblers.”

In
the
U.S.,
gambling
on
the
outcomes
of
elections
is
illegal
in
most
states,

including
Nevada.
However,
most
of
the
enforcement
is
done
by
the
Commodity
Futures
Trading
Commission
(CFTC).

Polymarket’s
Terms
of
Use
prohibit
it
from
being
used
by
U.S.
persons.

Prediction
market
KalshiEX

has
sued
the
CFTC
over
its
decision
to
ban
its
proposed
derivatives
contracts
for
betting
on
congressional
control,
arguing
that
these
contracts
are
lawful
and
beneficial
for
public
interest
by
enabling
risk
hedging
and
providing
predictive
data.

In
Taiwan,
while
gambling
activities,
including
participation
in,
promotion
of,
and
platform
hosting
for
betting
pools
like
Polymarket,
face
legal
consequences,
enforcing
actions
against
overseas
entities
presents
jurisdictional
challenges,
limiting
Taiwan’s
legal
reach
primarily
to
domestic
actors,
Lin
explained.

“Given
Polymarket’s
decentralized
nature
and
lack
of
physical
presence
in
Taiwan,
the
Taiwanese
judicial
system’s
reach
over
Polymarket
might
be
limited,”
he
said,
explaining
that
law
enforcement
would
likely
target
online
influencers
that
promoted
the
contract.

“There
have
been
recent
cases
where
Taiwanese
prosecutors
pursued
online
influencers
involved
in
promoting
trading
platforms,
suggesting
that
even
promotional
activities
could
lead
to
legal
implications,”
he
continued.

When
the
unlicensed
crypto
exchange
JPEX
collapsed
in
Hong
Kong,

local
law
enforcement
arrested
a
number
of
online
influencers
who
promoted
the
platform.

Lin
also
said
that
while
there
is
plenty
of
legal
precedent
to
go
after
centralized
entities
organizing
election
gambling,
there’s
“no
established
legal
precedent
in
Taiwan
for
decentralized
platforms
organizing
election
betting.”

Polymarket
CEO
Shayne
Coplan
did
not
have
a
comment
at
press
time.