Spain’s La Dirección General de Ordenación del Juego (DGOJ) has become the latest gambling regulator in Europe to launch disciplinary proceedings against prediction market operators Polymarket and Kalshi.
The regulator has accused both companies of operating in the country without the required gambling licenses.
In a notice published in Spain’s Official State Gazette (BOE), the DGOJ confirmed it has also ordered the precautionary blocking of both websites in Spain while the proceedings are ongoing.
The regulator said prediction markets fall within Spain’s gambling framework whereby users can wager on future events, meaning operators must hold a specific administrative authorisation to legally offer the products in the country.
The DGOJ stressed that unlicensed platforms do not comply with Spain’s regulatory safeguards, including identity verification controls, protections preventing access by minors and self-excluded users, and broader consumer protection standards.
Spanish authorities said attempts to directly notify Polymarket and Kalshi at their overseas addresses were unsuccessful, leading to the regulator instigating legal action. The disciplinary process is expected to take between three and four months before a final decision is issued.
Spain becomes Polymarket and Kalshi’s latest opposer
The new ban from Spain is a continuation of intense industry-wide scrutiny of prediction markets, particularly on flagbearers Polymarket and Kalshi, from European jurisdictions.
The markets that have undertaken action against prediction markets include:
- Romania
- Germany
- Belgium
- Italy
- Poland
- Hungary
- The Netherlands
- Switzerland
- France
- Portugal
However, there has been one outlier: Gibraltar. The jurisdiction is the only market thus far which has licensed the FIFA World Cup’s official prediction market partner ADI Predictstreet as a betting intermediary.
The condemnation of these platforms has not just been limited to Europe, however. Just yesterday, Indonesian authorities blocked Polymarket after the platform took bets – or “events contracts” – on the early culmination of Prabowo Subianto’s presidency, which is set to end in 2029.
This weekend also saw concerns raised in Australia regarding Polymarket and Kalshi amid wagers on political events there too, with experts claiming that, despite them being banned in the country, citizens could easily bypass laws via the use of VPNs.
In the US, prediction markets are regulated by the Commodity Futures Trading Commission (CFTC), placing them as derivatives markets as opposed to gambling operators.
But it is not all positive there for these platforms either, with states such as Arizona, Nevada and Rhode Island taking umbrage with Polymarket and Kalshi. The sites have also been banned in Brazil.
Gambling operators, including MGM and Flutter Entertainment, have cited prediction market platforms in investors calls and at events, claiming that their emergence has been unprecedented, resulting in a reduction in market share for traditional gambling firms.
As a result, some major operators have launched their own prediction-style products to stay ahead of the curve.
However, more and more jurisdictions seem to be clamping down on their activities. Despite these predictions companies gaining multi-billion-dollar valuations, a change of strategy may be necessary to evoke serious global growth – at least in a legal manner.