Kalshi, the US prediction market, has partnered with XP International in an agreement that will expand the reach of prediction markets across Brazil.
The partnership will allow clients of Clear, XP’s brokerage, who hold an international investment account with the XP Inc. subsidiary, to trade on prediction markets through Kalshi’s platform.
The move marks the first time that a Brazilian financial institution has offered access to prediction markets as part of a global investment portfolio.
Prediction markets are derivative instruments that allow traders to take positions on the outcomes of real-world events, such as economic indicators or financial data releases.
Contract prices move in real time based on market expectations, effectively reflecting the probability of a particular outcome.
The platforms are branded as a form of financial services, but have drawn comparisons with betting exchanges – and some regulators have labelled them a form of gambling.
The similarities drawn were echoed to a point where Smarkets Chief Executive Officer, Jason Trost, said that prediction markets and betting exchanges are “not apples and oranges – they’re both apples”.
Kalshi’s controversy
Prediction markets have come under much scrutiny in the last few months, with Kalshi and its main competitor Polymarket both being banned in New Zealand. The latter was also recently ordered to cease operating in the Netherlands, with Dutch regulator Kansspelautoriteit claiming that the platform offers ‘illegal gambling services’.
The negative criticism of the platforms doesn’t stop there. In recent weeks, there’s been a negative stream of media coverage that has rained down on both Kalshi and Polymarket due to them offering markets on the Iran/US war, the US military action in Venezuela and the possibility of further conflict in the Middle East.
The backlash against predictions has led to some political action. Just last week, a bill was introduced to the US Senate which, if approved, would ban US government officials from trading on platforms like Kalshi and Polymarket.
Another bill has also been introduced to the House of Representatives seeking to prohibit contracts around ‘terrorism, assassination, war, gaming (sports or athletic competitions), or illegal activity’. Both bills have been introduced by Democratic Party politicians.
It’s not just geopolitics, however. The events being wagered on also include some not too dissimilar to those offered by sports betting operators, such as the World Cup 2026 winner and Champions League matches, as well as more obscure markets, like whether Jesus Christ will return before 2027 or if the US will confirm that aliens are real.
Kalshi going global
Kalshi operates in the US as a regulated event contracts exchange under the oversight of the Commodity Futures Trading Commission (CFTC). As a result, the platform is able to offer events and sports contracts in states that currently do not permit sports betting, such as California and Texas.
In Brazil, Lucas Rabechini, Director of Financial Products at XP Inc., said that the partnership would introduce a new asset class to the market.
“XP has always aimed to expand access to new ways of investing,” he said.
“Prediction markets introduce a new asset class to the Brazilian market, offering investors one more tool for scenario analysis, positioning, and portfolio protection.
“We believe this market has high potential to broaden and complement the current investment landscape.”
For Kalshi, the agreement represents its first strategic partnership with a financial institution outside the US. International expansion has been on the firm’s agenda for some time, such as making itself available in 140 countries last October – though some of these nations have since blocked the platform.
Luana Lopes Lara, co-founder and Chief Operating Officer of Kalshi, commented: “As a Brazilian, I couldn’t be more excited for XP to be Kalshi’s first brokerage partner outside the US.
“XP is one of Brazil’s largest financial institutions; expanding prediction markets to Brazil is an important step in providing more people around the world with access to fair, safe, and regulated markets.”
Brazilian market under political fire
Kalshi’s launch comes in a jurisdiction in which gambling has been a hot topic in the last 12 months.
Last month, B3 became the first prediction market to launch in Brazil, with the Brazilian Securities and Exchange Commission placing the platform under securities as opposed to the sports betting framework.
There is still no regulatory framework for prediction markets in the country and many will wait with baited breath to see whether one will be implemented, particularly given President Luiz Inácio Lula da Silva’s recent stances on the gaming sector.
Under current legislation, both land-based and online casinos are prohibited in Brazil – both of which have been the subject of a series of scathing attacks from Lula in 2026 after it was estimated that the gambling industry generated approximately R$37bn (£5.25bn) in gross gaming revenue in 2025 – its first year with a regulated betting market.
It may be a question as to when, rather than if, platforms like Kalshi and B3 will come across similar political or regulatory roadblocks in Brazil.
Initially, Kalshi’s offering will focus on contracts tied to financial and economic events, with XP saying that access will be rolled out gradually in line with investor profiles and regulatory requirements.
Rabechini concluded: “We are bringing this instrument to help our clients invest better, with more alternatives for exposure to relevant economic events.
“Just as we democratised access to the stock exchange in the past, we are now taking another step by introducing a market model already used in advanced economies, always with responsibility, education, and governance.”