Global Crypto Regulatory Landscape Sees French Blockade of Polymarket, Slowdown in MiCA Licensing, and Malaysian Tech Probe

In a significant development for the decentralized prediction market space, France’s Autorité nationale des jeux (ANJ), or the National Gambling Authority, has mandated internet service providers (ISPs) to block access to Polymarket. This action, announced in a Friday press release, classifies prediction websites as illegal gambling operations within France. The ANJ explicitly stated that Polymarket’s operations are not authorized in the country, and promoting such unauthorized gambling sites constitutes a criminal offense, carrying potential fines of up to 100,000 euros (approximately $114,000).

Prediction markets, such as Polymarket, enable users to engage in financial contracts tied to the outcomes of a wide array of future events, ranging from electoral results and sporting competitions to economic indicators and geopolitical developments. Polymarket has experienced a substantial surge in popularity over the past two years, facilitating billions of dollars in trading volume. However, this growth has also attracted increased scrutiny from regulators worldwide, who are examining whether its event-based contracts fall under the purview of illegal gambling or constitute unlicensed financial products.

France is not alone in its regulatory stance against Polymarket. Several other countries have previously implemented access blocks, including Singapore, Poland, Portugal, Hungary, Ukraine, Brazil, and Indonesia. At the time of reporting, Polymarket indicated that it was subject to geo-blocking in a total of 36 regions. The French gambling regulator had initially signaled its intention to block the platform in November 2024, citing non-compliance with national gambling laws.

Meanwhile, the European Securities and Markets Authority (ESMA) has released its second post-deadline update to the Markets in Crypto-Assets (MiCA) framework register. This update saw the addition of 14 new crypto firms, a figure that suggests a moderating pace of licensing following an initial surge of approvals. The ESMA updated its interim MiCA register on Thursday, bringing the cumulative total of licensed crypto-asset service providers (CASPs) to 294.

Notable among the newly registered entities are Ripple Payments Europe, the European operational arm of the blockchain technology company Ripple, and Bison Bank, a Portugal-based financial institution. Additionally, Croatia’s state-owned bank, Hrvatska poštanaska banka (HPB), has also been added to the register. This latest update follows a previous expansion on July 3rd, when ESMA incorporated 37 CASPs into its register, marking the first significant post-deadline update after the transitional period for MiCA concluded. ESMA also reported no changes to its registers concerning electronic money tokens (EMTs), which are designed to maintain a stable value pegged to a single official currency, nor to asset-referenced tokens (ARTs), which are linked to a basket of assets such as currencies or commodities. The MiCA regulation aims to harmonize crypto-asset services across the European Union, providing a clear regulatory framework and enhancing consumer protection.

In a separate international development, Balaji Srinivasan, the founder of Network School, is actively seeking a formal memorandum of understanding with the Malaysian government. This pursuit comes in the wake of a government probe into his Forest City tech community, which was reportedly investigating allegations of hosting Israeli citizens utilizing second passports. Malaysia’s Home Affairs Ministry confirmed on Tuesday that it was investigating Srinivasan’s start-up community located in Johor. The probe was initiated following claims that the community included Israelis, a potential violation of the country’s immigration laws. However, initial checks conducted by the authorities found that all 266 foreigners within the community possessed valid travel documents.

Srinivasan has articulated that a formal agreement with Malaysia would provide Network School with the necessary legal certainty to continue its investments in the country. He has also indicated that without such assurances, the community might consider relocating its capital and operations to countries perceived as more welcoming to tech ventures. In a video message directed at Malaysian Prime Minister Anwar Ibrahim on Thursday, Srinivasan stated, "I’d like to have a document which says not just abstractly that tech is welcome… but rather that we’re personally welcome." This situation highlights the delicate balance between national security concerns and the desire to attract foreign investment and talent in the rapidly evolving tech and crypto sectors. The outcome of these negotiations could set a precedent for future technology hubs operating within Malaysia and influence the perception of the country as an attractive destination for global innovators.