Prediction markets boom as Korea grapples with legal gray zone

Wagers placed on an overseas platform over the outcome of Seoul's mayoral election reached $43.68 million in May — even though such betting is illegal in Korea.

The wager was hardly an isolated incident.

Prediction market platforms, which usually operate using stablecoins, allow users to place bets on the outcomes of elections, wars, sporting events and virtually any other matters of public interest.

Korea is increasingly part of that trend, with wagers now covering not only Korean politics but also its economy.

On Polymarket, the world's largest prediction market platform, the most popular Korea-related wager as of Tuesday was over how high the iShares MSCI South Korea exchange traded-fund (ETF) would climb during the week of July 20.

The contract closes Friday, with $18,067 already bet.

Although it is difficult to determine how many Koreans use the platform, anecdotal accounts suggest that at least some have begun experimenting with it.

One Korean user wrote on an online community that he had tried Polymarket while researching stablecoins and turned $70 into $170 in a single day.

He ...