Polymarket's decision to enable betting on ongoing military conflicts is sparking serious questions about regulatory compliance. The platform's approach has caught the attention of industry watchers who are asking: does wagering on active warfare violate U.S. federal statutes? It's a thorny issue that sits at the intersection of innovation and regulation. As prediction markets gain traction in the crypto space, questions about the boundaries of what users can stake on—and whether platforms bear responsibility for certain bet types—are becoming increasingly urgent. Whether this represents a genuine legal gray area or a compliance overstep remains hotly debated.