ESMA: Major prediction markets like Polymarket lack EU authorization

The European Securities and Markets Authority (ESMA) stated in a risk report that prediction platforms such as Polymarket and Kalshi currently lack the necessary authorization to provide event contract services in the EU. ESMA questioned the effectiveness of geofencing and VPN blocks, noting that event contracts may be classified as financial instruments under MiCA or subject to national gambling regulations, which could restrict their distribution to retail investors.