Dragon King Palace is a mythical place rumored to exist among fishermen. The legend goes that if one catches a fish from the palace, good luck and fortune will pour into the person's life. While it may sound like an old superstition, there is possibly some merit in the existence of such a place. It was stated in Guldove that the Dragonians built other ruins similar to Fort Dragonia, but as of 1020 A.D., the aforementioned fort was the only one to still stand. This somewhat raises the possibility of the Dragon King Palace legend stemming from an actual Dragonian fort built around the El Nido Triangle.
The idea may have its origin in the Japanese legend of Ryūgū-jō.
From: Locations (Chrono Cross)