Polymarket Banned in Amsterdam, Netherlands over 'Illegal Gambling'

The Netherlands Gambling Authority (Ksa) has banned Polymarket, labeling it as illegal gambling under Dutch law. The platform, known for its prediction markets, was ordered to stop operating in the Netherlands by February 17, 2026. Non-compliance could lead to fines of $462,000 per week. Regulators argue Polymarket violates the Dutch Betting and Gaming Act by allowing users to bet on events outside their control, such as political elections. During the October 2025 elections, Dutch users wagered over $32 million, highlighting the platform's popularity before the ban.

Key points:

• Reason for Ban: Classified as illegal gambling under Dutch law.
• Deadline for Compliance: February 17, 2026.
• Potential Fine: $462,000 per week for non-compliance.
• User Activity: $32 million wagered during October 2025 Dutch elections.
• Regulatory Concerns: Risks of influencing democratic processes and lack of geo-blocking.

This decision reflects the growing scrutiny of prediction markets globally, with similar restrictions in countries like France and Belgium. Traders in the Netherlands must now settle open contracts and explore automated trading on Polymarket alternatives while adhering to local laws.

Regulatory Issues for Prediction Markets

How Countries Regulate Prediction Markets

Prediction markets operate under vastly different legal frameworks depending on the country. The main debate revolves around whether these platforms should be classified as financial instruments or gambling operations, which directly impacts how they are regulated.

In the United States, the Commodity Futures Trading Commission (CFTC) oversees prediction markets, treating them as event-based binary options that require registration. For instance, in January 2022, the CFTC fined Polymarket $1.4 million for offering unregistered contracts. However, U.S. regulation is far from uniform. Some states, like Nevada and Massachusetts, view prediction markets as illegal betting platforms, creating additional legal hurdles.

European regulators generally adopt a more restrictive approach. France’s l'Autorité Nationale des Jeux (ANJ) blocked access to Polymarket in late 2024, citing illegal online gaming activities. Similarly, Belgium has instructed internet service providers to restrict access to the platform. The Netherlands stands out as one of the strictest jurisdictions, banning all betting on political events, citing concerns about the potential to distort democratic processes.

"If we are gambling, then I think you're basically calling the entire financial market gambling"
– Tarek Mansour, CEO of prediction market platform Kalshi

"Dutch enforcement reflects a regulatory culture that prioritizes consumer protection and systemic integrity over a more permissive, innovation-first approach"
– Jan Scheele, Board Member of Blockchain Netherlands Foundation

These varying regulatory stances highlight the complex challenges prediction markets face in securing licenses and maintaining compliance.

Licensing and Compliance Requirements

Prediction markets often struggle to secure proper licensing because they don’t fit neatly into existing regulatory categories. Many jurisdictions lack specific rules for these platforms, forcing regulators to apply traditional gambling laws instead.

One key focus for regulators is determining whether platforms are "actively targeting" restricted markets. Evidence of such targeting can include marketing strategies or platform accessibility in prohibited regions. For example, a Ksa supervisor placed a test bet on Dutch politician Rob Jetten to demonstrate how easily the platform could be accessed in the Netherlands. Regulators are increasingly emphasizing compliance measures like geo-blocking and clear jurisdictional exclusions.

Platforms also face a range of compliance requirements, including adhering to consumer protection standards, anti-money laundering regulations, and advertising restrictions. These challenges become even more pronounced during election cycles. For example, regulatory scrutiny intensified during the 2024 U.S. elections and the 2025 Dutch elections. By November 2025, global trading volumes on prediction platforms had surpassed $13.5 billion per month.

Beyond the U.S. and Europe, prediction markets face legal challenges in countries such as the United Kingdom, Germany, Italy, Australia, Singapore, Portugal, Hungary, and Thailand. Regulators worldwide continue to grapple with how to classify and oversee these platforms, reflecting the ongoing uncertainty in this emerging industry.

Trading Options After the Ban

Using VPS Hosting for low-latency vs. ultra-low latency trading

A Virtual Private Server (VPS) is a reliable tool for traders who need uninterrupted market access. By running trading software on remote servers operating 24/7, a VPS minimizes the risk of local disruptions, like internet outages or power failures. This setup ensures that trading bots and monitoring tools stay active, enabling traders to react quickly to market changes. With continuous connectivity, VPS hosting becomes an essential part of maintaining a smooth trading experience. Moreover, the infrastructure's strategic placement enhances performance, offering faster connections to key markets.

Benefits of QuantVPS Dublin Location

QuantVPS takes these advantages to the next level with its Dublin-based infrastructure. Dublin has become a prime location for European traders, thanks to its proximity to major internet exchange points and direct transatlantic fiber connections.

"Ireland sits at a strategic point between North America and Europe. Data centers in Dublin benefit from high-capacity transatlantic fiber connections, providing stable global network access."
– TradoxVPS Engineering Team

The QuantVPS Dublin location offers latency of under 1 millisecond when connecting to Polymarket's Central Limit Order Book (CLOB). This ultra-low latency is critical for executing time-sensitive trading strategies. The data center is equipped with redundant power systems, top-tier network hardware, and direct links to major cloud providers, ensuring performance and reliability. This setup not only reduces latency but also supports traders in meeting regulatory requirements. Pricing starts at $41.99 per month (billed annually) for the VPS Lite plan, with scalable options for those needing more robust configurations.

Staying Compliant with Local Laws

While technical solutions like VPS hosting help maintain market access, staying within the bounds of local laws is just as important. The Netherlands Gambling Authority (KSA) has been actively enforcing regulations, targeting platforms offering unlicensed services. Polymarket's operator, for instance, has faced a steep weekly fine of $462,000 for non-compliance. Dutch authorities classify prediction markets as "games of chance", which require specific licensing to operate legally.

Regulatory enforcement often includes direct testing of platform accessibility, emphasizing the need for traders to stay informed. Consulting legal experts is crucial for understanding the distinction between financial prediction and gambling under Dutch law. Additionally, traders should be aware of proposed tax changes, like the 36% capital gains tax on digital asset investments, which could be implemented by 2028.

Technology's Role in Trading Performance

Why Low Latency Matters for Traders

In high-frequency and algorithmic trading, every millisecond counts. With prediction markets processing over 43 million transactions and managing more than $13.5 billion in monthly trading volume, execution speed becomes a game-changer. Even a 100-millisecond delay can mean missing out on a trade at the desired price.

This need for speed becomes even more critical during volatile market events, like sudden regulatory announcements. For instance, when the Dutch Gambling Authority (KSA) announced potential fines of approximately $493,968 per week for non-compliance, market conditions shifted rapidly. Traders using automated strategies required infrastructure capable of reacting in fractions of a second - far quicker than any manual response.

Geographic proximity to exchange servers plays a key role in reducing latency. The fewer network hops data has to travel, the faster the execution. For traders, the physical location of their servers relative to Polymarket's Central Limit Order Book (CLOB) is crucial. Strategically placing servers in locations like Dublin, which benefits from direct transatlantic fiber connections and proximity to major internet exchange points, ensures stable global access and the ultra-low latency required for time-sensitive trades.

These latency optimizations are directly tied to better performance, a topic explored further in the next section.

How QuantVPS Supports Trading Operations

QuantVPS takes the need for low latency and builds on it with high-performance hardware and network configurations. The platform features cutting-edge CPUs and NVMe storage, ensuring rapid data handling and throughput. This setup not only enhances trading performance but also supports compliance by enabling traders to adapt quickly to regulatory changes.

The platform is fully compatible with popular trading software like NinjaTrader, MetaTrader, and TradeStation. This means traders can deploy their existing strategies seamlessly, avoiding the need for time-consuming reconfigurations - especially valuable during periods of regulatory uncertainty.

QuantVPS also provides unmetered bandwidth on networks exceeding 1Gbps, ensuring smooth performance even during high-traffic periods. For example, in December 2025, around 50,000 people in the Netherlands searched for Polymarket despite regulatory restrictions. Maintaining sufficient network capacity during such spikes was essential for uninterrupted trading. Additionally, QuantVPS servers are equipped with redundant power systems and DDoS protection, offering reliability and security even during peak activity or external threats.

Conclusion

Main Takeaways

The Amsterdam ban highlights a significant shift in how regulators view prediction markets, categorizing them as illegal gambling rather than financial tools. The KSA's enforcement actions, including a $462,000 weekly fine imposed on Polymarket for non-compliance, underscore the seriousness with which these restrictions are applied. With prediction markets now restricted in over 30 countries and boasting $13.5 billion in monthly trading volume as of November 2025, traders must navigate a landscape where compliance and robust trading infrastructure are equally important.

Despite these challenges, demand remains strong. Dutch users wagered over $32 million during the October 2025 elections, and 50,000 searches for Polymarket were recorded in December 2025, even after the ban. For traders operating in compliant regions, solutions like QuantVPS provide the speed and reliability needed to respond to rapid market changes driven by regulatory updates. These trends emphasize the need for vigilance in regulatory compliance and investment in advanced trading technology.

Next Steps for Traders

Given these developments, traders need to adapt their strategies to align with the evolving regulatory environment. Keeping a close eye on regulatory changes is critical, as enforcement tactics are becoming increasingly sophisticated. For instance, the KSA's methods - such as placing test bets and analyzing passive accessibility factors like local payment options - illustrate how regulators identify unlicensed platforms. Understanding whether prediction markets are classified as gambling or financial trading in specific regions is vital to avoid potential service disruptions.

For traders in compliant regions, optimizing trading infrastructure is just as important. QuantVPS's Dublin-based infrastructure offers ultra-low latency, unmetered bandwidth on 1Gbps+ networks, and compatibility with popular platforms like NinjaTrader and MetaTrader. This setup enables the fast execution speeds required during periods of high trading activity, such as the record-breaking single-day trading volume of $701.7 million in January 2026.

As regulatory uncertainty continues to shape the market, traders must combine legal awareness with cutting-edge technology to stay competitive in this rapidly changing environment.

FAQs

Does this ban apply to all of the Netherlands or only Amsterdam?

The restriction applies specifically to Amsterdam-based VPS users, leaving the rest of the Netherlands unaffected. Users located outside Amsterdam can still access services without any limitations.

What should I do with open Polymarket positions before the deadline?

If you have open positions on Polymarket, make sure to close them before the deadline. This step is crucial to avoid potential losses or complications. The platform has been directed to halt operations in the Netherlands because it lacks the necessary license for gambling activities. Waiting too long to act could lead to unexpected issues with your positions.

Can I legally access Polymarket’s CLOB from the Netherlands using a VPS?

Accessing Polymarket's Central Limit Order Book (CLOB) from the Netherlands using a VPS is not permitted. The platform is prohibited in the Netherlands due to concerns about illegal gambling activities. As a result, any orders originating from the Netherlands are restricted.