Jdigital Endorses Spain’s Decision to Temporarily Block Prediction Markets from Licensing

(AsiaGameHub) –   Jdigital, the Spanish online gambling trade association, has announced that its members fully endorse the decision to ‘temporarily halt’ the licensing of prediction markets.

Yesterday, the official gazette of the Dirección General de Ordenación del Juego (DGOJ), Spain’s gambling authority, revealed that it had initiated disciplinary reviews against the prediction market platforms Polymarket and Kalshi.

Spain’s gambling regulator has granted Kalshi and Polymarket a three-month and four-month period, respectively, to apply for a Spanish online gambling license. Access to both platforms has been suspended pending the approval of this process.

It remains unclear whether Kalshi and Polymarket will comply with the DGOJ’s request, which outlined the regulator’s need to ascertain the offerings of prediction markets and how they differ from the gambling mechanics covered by standard licenses.

At the core of this issue is a question that regulators globally are increasingly grappling with: what precisely constitutes a prediction market?

The DGOJ asserts that “when consumers wager money on uncertain future events—be it elections, sporting results, or economic developments—the activity falls squarely within the country’s gambling framework.”

The fact that operators market these products as event contracts or trading instruments does not change their legal classification under Spain’s Gambling Act of 2011.

Jdigital has welcomed the regulator’s intervention, characterizing it as a crucial step in safeguarding both consumers and Spain’s regulated gambling market.

The association contended that platforms operating without licenses undermine a system where authorized operators are subject to extensive obligations, including identity verification, anti-money laundering controls, responsible gambling measures, and protections for minors and vulnerable individuals.

“Players who access operators without a license are outside the scope of the policies and guarantees provided within the regulated market,” the trade body stated.

It further cautioned that consumers using unlicensed prediction market platforms lack access to the safeguards mandated for regulated operators, adding that “any citizen who accesses an unlicensed prediction market platform will not benefit from any of these guarantees.”

This dispute also highlights growing discontent within Europe’s licensed gambling sector. Jdigital has consistently argued that regulated operators face escalating compliance costs, advertising restrictions, and consumer protection requirements, while offshore and unlicensed businesses can target customers with significantly less oversight.

According to an EY report referenced by Jdigital, “one in four Spanish gamblers has used an unlicensed platform,” a statistic used to support the argument that “Spanish authorities should intensify enforcement efforts against illegal operators.”

However, the broader struggle extends beyond Spain. Across Europe, regulators are intensifying their scrutiny of prediction market businesses, with France, Belgium, Germany, Portugal, Poland, and the Netherlands all taking action against operators attempting to offer event-based contracts without local authorization.

Meanwhile, the British overseas territory of Gibraltar has already established a licensing framework for prediction market activities. Furthermore, last week, Malta indicated its intention to examine how prediction market platforms should be integrated into future regulatory structures.

Domestically in the US, prediction markets are regulated by the Commodity Futures Trading Commission (CFTC) as derivative products rather than gambling services. The sector has also garnered significant political support.

This week, US President Donald Trump described prediction market platforms as vital to the future of the American economy, adding further momentum to an industry that has attracted billions of dollars in investment.

For European regulators, however, the primary concern remains consumer protection and market integrity, rather than financial innovation.

Spain’s decision, therefore, signifies more than a national enforcement action. It serves as the latest indication that European authorities are unwilling to permit prediction markets to operate outside established gambling frameworks.

For the time being, another major European jurisdiction has closed its doors to Polymarket and Kalshi. However, the conflict is unlikely to conclude here.

For these high-stakes ventures, the next logical step will almost certainly be to lobby Brussels and national governments to recognize event contracts as financial derivatives rather than gambling products.

This legal distinction could ultimately determine whether prediction markets evolve into a mainstream financial product in Europe or remain excluded from the continent’s regulated markets.