EU Regulator Says Prediction Markets Are 'Rife With Inside Trading'
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Kalshi's trading volume hit a record high of $9.4 billion in June, with the World Cup driving a surge in prediction market trading.
According to Mars Finance, on July 5th, driven by the 2026 FIFA World Cup, the trading volume of the US prediction market platform Kalshi rose to approximately $9.4 billion in June, an increase of nearly 77% from approximately $5.3 billion in May, setting a new record. During the same period, Polymarket International's trading volume increased from approximately $3.5 billion to approximately $4.3 billion. Data shows that the World Cup has become the main catalyst for the growth in prediction market trading. As this World Cup expands to 48 teams for the first time, the number of matches and knockout stage scenarios has increased, driving active trading in single-match contracts. For example, the round of 16 match between Canada and Morocco saw trading volumes exceeding $48 million on Kalshi and $26.8 million on Polymarket. However, the rapid increase in trading volume has also further fueled regulatory controversy. Several US states continue to advocate that sports event contracts should be subject to betting regulations, rather than the derivatives market regulated by the US Commodity Futures Trading Commission (CFTC). Meanwhile, the European Securities and Markets Authority (ESMA) recently warned that some event-based contracts may fall under the existing regulatory scope of binary options. Analysts believe that the World Cup demonstrated the ability of prediction markets to attract liquidity during major events, but whether sports prediction contracts should be regulated as financial derivatives or betting remains a core regulatory issue for the industry.
Tensions Flare as CME, Kalshi Execs Clash Over Prediction Markets in DC
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Data: Signa platform users have created 854 World Cup-related prediction markets.
According to Foresight News , Signa's latest data shows that the popularity of the 2026 FIFA World Cup-themed prediction market continues to rise as the World Cup knockout stages unfold. To date, platform users have created 854 World Cup-related prediction markets. The cumulative trading volume has reached $788,400, with 6,200 trades completed. The number of participating users has increased to 3,620, and the total value locked (TVL) has reached $755,100. Signa stated that the World Cup is becoming a significant catalyst for the growth of the prediction market, and that more innovative marketing and interactive activities centered around the tournament and trending events will be launched in the future to bring users a richer experience.
The People's Bank of China and Hong Kong regulators support the joint establishment of a fixed-income and currency electronic trading platform in Hong Kong.
PANews reported on July 7 that the People's Bank of China, the Hong Kong Monetary Authority, and the Hong Kong Securities and Futures Commission jointly announced their welcome to the China Foreign Exchange Trading Center and the Hong Kong Stock Exchange for jointly establishing a Hong Kong electronic fixed income and currency trading platform. This initiative aims to deepen cooperation between the mainland and Hong Kong financial markets and consolidate Hong Kong's position as an international financial center and offshore RMB business hub. The announcement stated that the platform will be based in Hong Kong, oriented towards the international market, and will adhere to international market standards and Hong Kong regulatory requirements. It will strive to create an open, fair, efficient, and stable fixed income and currency trading infrastructure, and will enhance trading efficiency and transparency, promote price discovery, reduce transaction costs, and explore technological innovation to empower financial services. The specific launch date of the platform will be announced in due course.
EU regulators warn: Some prediction market event contracts are prohibited from being sold to retail investors.
BlockBeats reported on July 5th that the European Securities and Markets Authority (ESMA) issued a statement saying that if "event contracts" in prediction markets meet the definition of financial instruments, they fall under the category of binary options and, according to EU regulations, cannot be marketed, distributed, or sold to retail investors. ESMA stated that the legal status of a product depends on its actual function, not on its commercial name such as "event contract." If the relevant contract meets the MiFID II definition of a financial instrument, it will be considered a derivative and subject to the EU's binary options ban. ESMA also pointed out that even if a platform only offers related products to professional investors, it still needs to obtain MiFID II authorization if it provides related investment services in the EU. Furthermore, event contracts may also be subject to the gambling laws of individual member states; if the product is tokenized and does not fall under the financial instrument category, it may be subject to the Markets in Crypto-Assets Regulation (MiCA) framework.
Robinhood takes stakes in Crypto.com, OG.com in prediction markets deal
Robinhood will route event contracts through OG.com’s CFTC-regulated infrastructure as it expands its prediction markets business.