India’s government is cracking down on VPN providers that help users access banned betting platforms like Polymarket. The Ministry of Electronics and Information Technology (MeitY) has issued a stern warning: block access to these platforms or face serious legal consequences.
The move highlights India’s increasingly aggressive stance against online gambling and prediction markets. Users have been using VPNs to mask their location and convert rupees into stablecoins like USDC to participate in these prohibited platforms.
How users bypass India’s betting restrictions
MeitY revealed that users are systematically circumventing legal safeguards through a two-step process. First, they use VPN services to hide their Indian location. Then, they convert Indian Rupees into USD Coin (USDC) to participate in prediction markets that operate outside India’s regulatory reach.
The ministry said these activities create “serious concerns relating to unlawful online betting, circumvention of regulatory frameworks, potential financial risks, and threats to public order and economic integrity.”
Platforms like Polymarket remain accessible despite being blocked under Section 69A of the Information Technology Act, 2000. The government blocked these sites, but VPN services have made the restrictions largely ineffective.
New legal requirements for VPN companies
The April 25, 2026 advisory makes clear that VPN service providers must comply with strict due diligence obligations. These requirements fall under two key pieces of legislation:
- The Information Technology Act, 2000
- The IT (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021
Under these rules, intermediaries cannot host, transmit, or provide access to information that violates Indian laws. This includes content that could harm public order, sovereignty, or economic security.
MeitY emphasized that intermediaries must take “immediate and effective action” to prevent access to unlawful platforms involved in online betting and prediction market activities.
Safe harbor protections at risk
The government’s warning comes with teeth. VPN providers that fail to comply could lose their safe harbor protections under Section 79 of the IT Act. These protections currently shield intermediaries from liability for third-party content on their platforms.
Companies found to be aiding unlawful activities may face legal consequences under multiple laws, including the IT Act and the Bharatiya Nyaya Sanhita, 2023. The advisory also requires intermediaries to provide information or assistance to government agencies for investigations within prescribed timelines.
Broader gaming law changes strengthen enforcement
The advisory gains significant strength from the Promotion and Regulation of Online Gaming Act, 2025 (PROG Act). This law prohibits all forms of real-money online gaming in India and removed previous legal ambiguity around “games of skill.”
Under current law, any online platform where users stake money or digital assets expecting a reward is classified as an “online money game.” These platforms are strictly prohibited unless licensed by the National Online Gaming Commission.
The law also clarifies that any platform facilitating access to such activities – including through VPN-based circumvention or financial transactions – violates Indian law. This applies regardless of whether the games are based on skill or chance.
Why this matters for the tech industry
This crackdown reflects broader global tensions over prediction markets and online gambling. India’s approach is particularly significant because it targets the infrastructure that enables access to banned platforms, not just the platforms themselves.
The move also signals India’s zero-tolerance policy toward unregulated digital gateways. The government recently issued advisories about Trust Wallet drainer scams and fake “BNB Chain verification” sites that trick users into approving malicious smart contracts.
For VPN providers, this creates a challenging compliance landscape. They must now actively monitor and block access to specific platforms or risk losing crucial legal protections that their business models depend on.