Prediction markets in Europe: is it legal? Best platforms

Prediction markets have become one of the fastest-growing corners of the trading world. According to the 2026 Digital Asset Outlook Report by The Block, Polymarket and Kalshi alone processed more than $37 billion (€31.5 billion) in trading volume during 2025.

The catch for European users is that the legal status of prediction markets across Europe is fragmented and, in most cases, restrictive. There is no harmonised EU framework, no MiFID II classification for event contracts, and no single regulator overseeing the space. Every country applies its own gambling or financial rules and many of them have moved to block the largest international operators.

As of mid-2026, even US-regulated platforms like Kalshi have started to actively withdraw from EU jurisdictions where regulators have classified prediction markets as gambling.

This guide explains, in plain English, where prediction markets stand legally in Europe in 2026, which platforms are realistically accessible to European retail investors, and what your alternatives look like if you are based in the EU, the UK, or Switzerland.

_{Disclaimer: This article is for informational and educational purposes only and does not constitute financial, legal, or tax advice. Prediction markets are speculative products with a high risk of total loss of capital. Regulations change quickly - always verify the current legal status in your country before opening an account.}

What are prediction markets, in plain English?

A prediction market is a marketplace where you trade a contract tied to a yes-or-no question about a future event. For example:

• "Will the ECB cut rates at its July meeting?"
• "Will US CPI come in above 3% next month?"
• "Will Real Madrid win the Champions League?"

Each contract is priced between $0.01 and $0.99 (or 1¢ and 99¢). The price reflects the market's implied probability: a contract trading at 65¢ means the crowd believes there is roughly a 65% chance the event happens.

If you are correct at settlement, the contract pays $1.00. If you are wrong, it settles at $0.00. Your maximum loss is what you paid - there is no leverage in the traditional CFD sense, but you can lose 100% of every position.

This is the structural feature that creates the regulatory headache: the product looks like a futures contract to a financial regulator and looks like a fixed-odds bet to a gambling regulator.

Both views are defensible and most European regulators have classified them under the second category. As Euronews put it in late 2025, "the business of predicting the future is booming, but EU regulators remain uneasy".

The legal landscape in Europe in 2026

The single most important thing to understand is this: the EU has no unified prediction market framework. The EU has built one of the world's most comprehensive crypto regulatory frameworks (MiCA) but has zero framework for prediction markets specifically. Platforms fall between gambling and financial instruments with no single regulator in charge of the gap.

In practice, three regulatory approaches are emerging across the continent:

1. Gambling-law approach (most common): National gambling regulators classify prediction markets as unlicensed online gambling and order ISP-level blocks or impose fines. This is the path taken by France's ANJ, Belgium's Gaming Commission, the Netherlands' KSA, Portugal's SRIJ, Hungary's regulatory authority, Bulgaria, and others.
2. Soft prohibition / warnings: Regulators such as Germany's Joint Gambling Authority (GGL) explicitly warn the public that participation is illegal, even if no formal block has been imposed.
3. Regulated experimentation: Gibraltar has licensed Europe's first regulated prediction market operator, ADI Predictstreet, in April 2026, and Malta has stated it is exploring a dedicated framework. These are the exceptions, not the rule.

Two pieces of EU-level regulation are also worth flagging:

• MiCA (Markets in Crypto-Assets): MiCA comes into full effect with the grandfathering period ending in July 2026. Crypto-based prediction markets like Polymarket will need a Crypto-Asset Service Provider (CASP) licence to serve EU users legally. So far, none of the major operators have one.
• DAC8: From 2026, EU member states will receive automatic reporting on crypto wallet activity, which makes underground use of platforms like Polymarket significantly more visible to tax authorities.

Country-by-country summary

The table below summarises the legal status of the main prediction market operators (Polymarket and Kalshi) in the largest European jurisdictions as of May 2026.

Note: this is a rapidly moving area - always confirm current status before depositing funds.

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The Kalshi situation is particularly telling. Although Kalshi's published Member Agreement still lists only a handful of EU countries as restricted, in practice the platform has been progressively withdrawing from EU member states, citing the local classification of prediction markets as prohibited gambling activity.

Why is Europe so restrictive?

The pattern across European bans is consistent. National gambling regulators have framed Polymarket and similar platforms as unlicensed online gambling operators under each country's existing gaming act. As reported by IBTimes, "European regulators have been more uniform: France's ANJ, Germany's GGL, the Netherlands' KSA, Portugal's SRIJ, and Switzerland's Gespa have all classified prediction-market activity as unlicensed gambling."

In the UK specifically, there is an extra layer: the FCA's 2019 ban on the sale of binary options to retail consumers. Because Polymarket contracts settle at either $1.00 or $0.00 - a binary outcome - they are frequently classified under this restricted category.

Two recent enforcement actions illustrate the trend:

• Portugal (January 2026): The Portuguese gambling regulator ordered Polymarket to shut down within 48 hours after roughly $120 million in trading volume during the presidential election.
• Netherlands (February 2026): The Dutch gambling regulator KSA threatened fines of €420,000 per week if Polymarket continued serving Dutch users without a licence - the largest European enforcement action so far.

What about VPNs?

A common question is whether you can simply use a VPN to access a blocked platform. The honest answer is: technically possible, legally and practically risky.

• Polymarket's Terms of Service explicitly prohibit circumventing geographic restrictions. The platform uses geo-detection beyond simple IP checks and can freeze accounts and funds.
• For Kalshi, using a VPN to create an account in an unauthorized jurisdiction may result in account closure and asset seizure. There is also no legal protection for users in unauthorized jurisdictions.
• From a tax and compliance standpoint, you would still need to self-report any gains, and DAC8 makes wallet-level activity increasingly traceable from 2026 onward.

We do not recommend trying to bypass geographic restrictions. If a platform is blocked in your country, the safer option is to use a regulated alternative.

Best prediction market platforms for Europeans in 2026

The realistic universe of regulated, retail-accessible prediction market platforms for European users in 2026 is small. Below we walk through the platforms most-discussed by European traders and explain what each one actually offers.

Quick comparison

We have intentionally limited the table below to platforms that a European resident can realistically open an account with today. Plus500 Futures (US-only product) and Robinhood prediction markets (US-only, not yet launched in Europe) are covered further down the article for completeness, but they are not currently options for EU/UK retail investors.

1. Interactive Brokers - the most accessible regulated option for Europeans

Interactive Brokers (IBKR) is, in our view, the most realistic regulated entry point for European retail investors who want to trade prediction markets. Since July 2025, Forecast Contracts are available to eligible clients of Interactive Brokers LLC, Interactive Brokers Ireland Limited, Interactive Brokers Canada Inc., and Interactive Brokers Hong Kong Limited.

Through IBKR ForecastTrader, eligible EEA clients can trade Forecast Contracts listed on ForecastEx, IBKR's own CFTC-regulated Designated Contract Market, plus CME event contracts on futures markets.

What you can trade:

• US economic indicators (CPI, Fed Funds Rate, GDP, unemployment)
• Climate and CO₂ indicators
• CME event contracts on equity indices, energy, metals, and FX
• Not available to EEA clients: US election contracts (US residents only)

Key features:

• Zero commission on ForecastEx contracts (a $0.01 per contract fee is built into the price)
• Around-the-clock trading, six days a week
• An interest-like incentive coupon paid on open positions - currently around 3.14% APY on USD positions
• Defined-risk profile: max loss is what you paid; payout is $1 if correct
• Trade through TWS, IBKR Desktop, IBKR Mobile, or the dedicated ForecastTrader web interface

Important: not every EEA country is eligible. This is the part that catches most European readers off guard. According to the official IBKR Ireland disclosure:

"All Interactive Brokers Ireland Limited clients from Belgium are prohibited from trading event contracts. In addition, retail clients from Spain, Liechtenstein and Slovenia are prohibited from trading event contracts. Retail clients in eligible countries may trade up to the lesser of 1% of their NAV or USD 1.0 million in event contracts."

The practical recommendation: if you have an IBKR account, check whether ForecastTrader appears in your trading permissions menu. If it does and you are in an eligible country, this is the cleanest regulated route to prediction markets in Europe. If it does not, no amount of paperwork will change that - the restriction is at the country-of-residence level.

2. Polymarket - the largest, but mostly blocked in Europe

Polymarket is the world's largest prediction market by volume. It is a decentralised exchange built on the Polygon blockchain and uses USDC (a US-dollar stablecoin) for all trading. In October 2025, Polymarket secured up to a $2 billion investment from Intercontinental Exchange (ICE), the owner of the New York Stock Exchange, valuing the company at $8 billion.

How it works:

• You connect a crypto wallet, deposit USDC (via card, bank transfer, or crypto), and trade Yes/No shares directly on-chain.
• Market resolution relies on UMA's optimistic oracle.
• Markets cover everything from US politics to crypto prices, geopolitical events, sports, and pop culture.

Legal status in Europe (as of May 2026):

Polymarket is the platform that has attracted the most regulatory attention in Europe. According to its official geographic restrictions page and recent enforcement actions:

The trend is clearly toward more bans, not fewer. Polymarket started 2026 the same way it ended 2025: facing new bans while simultaneously trying to expand.

In a single week in January 2026, Portugal's gambling regulator ordered Polymarket to shut down within 48 hours after $120 million flowed through the platform on the country's presidential election. Hungary followed the same day with its own nationwide block.

Risks specific to Polymarket:

• No EU regulatory protection: there is no compensation scheme if the platform fails or your funds are frozen.
• Insider trading concerns: the platform has been scrutinised for trades that appear to use non-public information, particularly around geopolitical events.
• USDC exposure: you are taking implicit credit risk on the stablecoin issuer.
• Tax complexity: even if classified as gambling locally, converting USDC back to euros is a disposal event that may trigger capital gains reporting under DAC8.

3. Kalshi - regulated in the US, increasingly closed off to Europe

Kalshi is the first federally approved event contracts exchange in the US, regulated by the CFTC as both a Designated Contract Market and a Derivatives Clearing Organization. Unlike Polymarket, Kalshi runs on traditional financial infrastructure, settles in USD, and accepts standard bank deposits or debit cards. In October 2025, Kalshi raised over $300 million led by Sequoia and a16z, with a stated goal of expanding to over 140 countries.

In practice, that international expansion is being walked back in Europe. Throughout 2026, Kalshi has progressively withdrawn from EU member states whose regulators have classified prediction markets as gambling, even when those countries are not on the public Member Agreement restriction list.

Legal status in Europe (Kalshi, as of May 2026):

Concrete user-side evidence: users in Portugal who had previously opened Kalshi accounts have received emails reading: "Thank you for your interest and early adoption of Kalshi. Unfortunately, we are no longer available in your country as the region in which you are from prohibits prediction markets. We are no longer able to accept new deposits or trades from your account. Any existing account balances remain available for withdrawal at this time."

In short: Kalshi's published restricted-country list is no longer a reliable guide for the European user. The platform appears to be making case-by-case decisions to exit jurisdictions where local prohibition makes service untenable. If you are in any EU country where prediction markets are classified as gambling, you should assume Kalshi may not be reliably available, even if your country is not on the public restricted list.

How European access works (where still available):

• Sign-up requires identity verification and a country-of-residence declaration.
• International users can fund accounts via debit card (Visa/Mastercard), wire transfer (minimum $1,000), or cryptocurrency.
• ACH bank transfers, PayPal, and Venmo are not available outside the US.

Important caveats for European users:

• Kalshi holds no European licence. Outside the US, your activity is not protected by EU investor compensation schemes or by CFTC investor protections that apply only to US persons.
• Kalshi expressly disclaims providing legal or eligibility advice for international jurisdictions - it is your responsibility to determine local legality.
• Crypto withdrawals back to the EU may trigger DAC8 reporting from 2026 onward.

What about Plus500 and Robinhood?

Two other names that European traders frequently ask about are Plus500 and Robinhood. Both have launched prediction markets, but neither is currently available to European retail investors:

• Plus500 Futures launched prediction markets in late 2025 via a partnership with Kalshi. The product is offered exclusively through Plus500's US entity. The European Plus500 platform continues to offer CFDs and (in selected countries) futures access, but does not offer event contracts to EU/UK retail clients. Plus500 also acts as a clearing partner for FanDuel's prediction market product in the US, again not available in Europe.
• Robinhood launched its US Prediction Markets Hub in early 2025, with event contracts cleared through Kalshi and ForecastEx. Just one year after launch, more than nine billion contracts had been traded. Robinhood has confirmed it is in talks with the UK FCA and EU regulators about a possible international launch, but no European product exists today.

If you see articles claiming you can use these platforms from Europe, treat them with caution - they are almost always written from a US perspective.

A focus on Polymarket: how it works, and why Europe doesn't trust it

Because Polymarket attracts so much retail interest, it is worth a deeper look at exactly how it works and why European regulators have been so aggressive.

How Polymarket works mechanically

1. Connect a wallet: You sign up with an email and Polymarket creates a smart-contract wallet for you on the Polygon network.
2. Deposit USDC: You can buy USDC directly with a debit card via MoonPay, transfer it from Coinbase, or bridge it from Ethereum, Base, Arbitrum, or Solana.
3. Trade Yes/No shares: For every market, you can buy "Yes" or "No" shares at the live order-book price. Prices update in real time as new trades come in.
4. Hold to resolution or close early: At resolution, winning shares pay $1.00. You can also close a position early by selling at the current market price.
5. Withdraw: Convert USDC back to fiat through MoonPay or send it to an external exchange.

Why European regulators are uncomfortable

There are five recurring concerns:

1. No local licence: Polymarket is not authorised by any EU national gambling or financial regulator.
2. Binary payoff structure: Many EU jurisdictions classify $1/$0 binary contracts as either gambling or as the kind of binary options banned by ESMA in 2018.
3. Sensitive event contracts: Markets on war outcomes, conflicts, and political assassinations have triggered ethical concerns. Users who had placed large bets related to an Iranian missile strike in March 2026 are alleged to have harassed and threatened Israeli journalist Emanuel Fabian of The Times of Israel in an attempt to influence the market's outcome.
4. Insider trading risk: Several incidents have suggested that participants with non-public information (for example, around the Nobel Peace Prize selection in October 2025) traded ahead of public announcements.
5. Crypto-asset classification: Once MiCA grandfathering ends in July 2026, USDC-based platforms operating in the EU will need a CASP licence. None of the major prediction markets have one.

For a European retail investor, the combined effect is that even in countries where Polymarket is currently accessible (Spain, Ireland, Greece, etc.), there is meaningful regulatory uncertainty about whether it will remain so.

A focus on Kalshi: how it works, and where you stand as a European

Kalshi has the cleanest regulatory story of any prediction market in the United States. The challenge for European users is figuring out what that regulation does and does not protect, and whether you can keep using the platform at all.

How Kalshi works mechanically

1. Account opening: Provide email, basic personal information, and identity documents. International users go through an ID verification flow.
2. Funding: Outside the US, fund via debit card (Visa/Mastercard), wire transfer, or crypto.
3. Trade: Each contract trades between $0.01 and $0.99. You can use Quick Orders (market) or Limit Orders. The order book is fully transparent.
4. Settlement: At expiry, contracts pay either $1.00 (correct outcome) or $0.00 (incorrect outcome). Fees are variable, generally under 2% per trade based on potential earnings.
5. Withdrawal: International users can withdraw via debit card or crypto.

What CFTC regulation does and does not mean for you

Being CFTC-regulated means Kalshi has to operate transparent markets, segregate US customer funds, and clear trades through a registered clearinghouse. It does not mean European users are protected by EU investor protection schemes, have meaningful recourse to the CFTC, or that Kalshi is licensed in your country - you are simply being allowed to use its US platform if your jurisdiction isn't currently restricted.

In practice, if something goes wrong - account frozen, dispute over a market resolution, withdrawal delayed - your legal recourse as a European is limited.

And as the recent Portuguese experience shows, Kalshi can also unilaterally close access to your country at any time, restricting you to closing existing positions and withdrawing funds.

Risks to take seriously before trading prediction markets

Prediction markets sit in a category of their own when it comes to risk. They are not inherently more or less dangerous than CFDs or options, but the risks are different and easy to underestimate.

As a London Business School study cited recently in the press found, only around 3% of prediction market participants make consistent profits, while close to 70% lose money over time.

Capital risk: Every contract can settle at $0. A position that looks like "near-certain" at 95¢ still carries a 5% chance of total loss. People who size positions as if losses are unlikely tend to learn this lesson expensively.

Liquidity risk: Headline markets (US elections, Fed decisions) are deep. Niche markets often trade thinly, with wide bid/ask spreads. Closing a losing position early can be much harder than opening it.

Resolution risk: Markets can be ambiguously worded, especially around geopolitical events. You may be technically right and still lose if the resolution rules disagree.

Behavioural risk: The yes/no, binary structure of these markets is psychologically similar to fixed-odds betting. Several regulators and academics have raised concerns that prediction markets can encourage compulsive trading patterns more than traditional financial products.

Regulatory risk: As the Portugal and Hungary cases show, a country can move from "accessible" to "blocked" within 48 hours. If you have open positions when that happens, you may be limited to closing them and withdrawing - sometimes with operational delays. The Kalshi Portugal closure is a real-world example of how quickly access can disappear.

Tax risk: Tax treatment of prediction market gains varies dramatically by country. In some jurisdictions they may be taxed as gambling winnings (sometimes 0%, sometimes a flat tax), in others as capital gains, and in others as miscellaneous income. With DAC8 reporting in the EU from 2026, the era of unreported crypto-based gains is ending. Always consult a local tax professional.

Counterparty and infrastructure risk: For Polymarket, you are also taking smart-contract and oracle risk. For Kalshi-based products, you are taking US-broker risk without EU compensation coverage.

So, can a European actually trade prediction markets legally in 2026?

The short answer: yes, but the realistic options are narrow and shrinking.

For most EEA residents, Interactive Brokers' ForecastTrader is the most defensible choice - provided your country and client classification are eligible: a CFTC-regulated underlying exchange (ForecastEx), accessed through an EU-regulated broker (IBKR Ireland), with clear position limits and a familiar account structure. If your country is not eligible (Belgium for all clients, Spain, Liechtenstein, Slovenia for retail, plus other countries where IBKR has not enabled the product), then you do not have a regulated retail option at IBKR.

If you live in a country where Polymarket and Kalshi are still accessible, and you understand that you are using a non-EU-regulated platform, you can technically open an account on the international version of either. You will be subject to that platform's terms and to your own country's tax rules, with no recourse to EU investor protection.

If you live in a country where the major operators are blocked or have withdrawn - the UK, France, Belgium, the Netherlands, Portugal, Hungary, Switzerland, Bulgaria, with the list still growing - the practical answer is that you do not currently have a regulated retail option for general-purpose prediction markets. ADI Predictstreet (Gibraltar-licensed) may become an alternative for certain markets such as the 2026 FIFA World Cup, but it is too early to evaluate.

A final reminder: this is a fast-moving area. The status quo in May 2026 may well change before the end of the year, in either direction. As of April 2026, no EU member state has formally adopted a MiFID II-based approach to prediction markets, but academic and legal commentary suggests this is the likely long-term direction for financially-themed prediction markets, while event-based markets remain under gambling law.

_{Disclaimer: This article is for informational purposes only and does not constitute financial, legal, or tax advice. Prediction markets are speculative products with a high risk of total loss of capital. Always verify the current legal status in your jurisdiction before opening an account.}