What prediction markets actually are
In a prediction market, traders bet money on the answer to a yes-no question about a future event. Whoever is correct gets a predetermined amount. Otherwise the stake will be forfeited. The providers themselves are looking at this as a financial transaction and not as a game of chance . There is a thin line between the betting slip and the security, and exactly where it goes is disputed. The classification decides which authority is responsible and which protection rules apply.
What the supervisors specifically criticize
The gambling regulator published the joint statement on June 19 2026. They were signed by the gambling regulators from Belgium, USA, USA, Italy, the Netherlands, Poland, Portugal, USA and Switzerland. The occasion was the Football World Cup 2026 and the expected increase in betting activity. Authorities describe several addictive characteristics that are exacerbated where a provider is unlicensed.
What is mentioned are round-the-clock access, a lack of built-in betting limits beyond the set amount, a lack of time limits and only superficial checks of identity and therefore age. The combination of visibility, easy accessibility and viral spread creates a clear addictive cycle. According to the paper, there are also serious risks due to illegality, blocked balances, fraud through insider knowledge and strong price fluctuations.
The full joint statement from the nine supervisory authorities is available as a PDF, the USA classification is in the Announcement from the Joint Gaming Authority of the States.
The appeal to clubs, leagues and associations
One paragraph of the statement is not aimed at players at all. The supervisory authorities remind sports associations, leagues and clubs to check whether a provider of prediction markets is even permitted in their legal system before entering into larger partnerships.
The note is important because sponsorship massively increases the visibility of such offers in a short period of time. Also announcedIGT more cross-border cooperation , sharing information, expertise and best practices, as well as increasing social media presence for safe gaming.
How the financial regulator classifies the topic
Shortly after the gambling regulators' call, the European securities regulator got involved. ESMA reminded that the existing restrictions on binary options may apply. These are expressly not new rules. The decisive factor is the classification of the individual product, and this is more detailed than many reports portray. Only event contracts whose event question relates to an underlying specified in Annex I, Sections C(4) to (10) of MiFID II are considered financial instruments.
If this is true, are Marketing, distribution and sales to private customers prohibited . ESMA considers it likely that binary outcome and binary payout contracts will fall under this. The trade name plays no role. Even an offer exclusively to professional customers requires approval according to MiFID II . A footnote in the document is important for the USA legal situation, because such a contract can be classified as a bet under national gambling law.
The Public statement from ESMA on event contracts and binary options is freely available.
What this means for you as a player
In practice, it all boils down to a question of who will be responsible if something goes wrong. For a provider permitted in USA , the OASIS blocking system, the cross-provider deposit limit and the supervision of the gambling regulator apply. On an unauthorized prediction market, none of this applies, and in the event of a dispute, your money will be in a legal system where you can hardly enforce anything.
You can check the official whitelist to see whether a USA betting offer is permitted, which the authority already has its own Warning about illegal sports betting on the World Cup 2026 pointed out. We have explained how the blocking system works, which helps with problematic gaming behavior, in the article on OASIS player ban with over 300,000 registered people described.
➡️ If you want to know what means USA is using to combat unauthorized offers on the internet, then read our article on that Network operators have to block illegal gambling providers.
It is unclear how the USA supervisory authority will deal with these offers in the future. AnnouncedIGT is an action against providers who do not adhere to the respective national rules. We track this in ours Subject area law.
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