Polymarket Is Already Here. Why Are We Waiting to Regulate It?

Prediction markets like Polymarket and Kalshi aren't licensed in the UK, but that hasn't stopped British users accessing them via VPNs and cryptocurrency. If they're already here, why hasn't the UK developed a clearer regulatory strategy?

Prediction markets first gained mainstream attention through forecasting elections. Now, platforms allow users to speculate on everything from Love Island winners to millisecond moments from the FIFA World Cup. During this summer's tournament alone, billions of dollars were traded across the two platforms, with markets even asking whether Cristiano Ronaldo would cry before the final whistle.

That rapid expansion has fuelled an increasingly fierce regulatory debate in the United States. In Britain, however, the conversation has barely begun.

The scope of prediction markets is growing

Prediction markets have recently moved from what was a relatively niche space into the mainstream. They offer markets on entertainment, sport, and popular culture alongside politics and economics. If an outcome can be reduced to a simple yes-or-no question, someone is now trying to turn it into a market.

Supporters argue these platforms aggregate information more efficiently than polls. Critics see the gradual gamification of everyday life. While both have valid opinions, the more important question is not about whether we can predict the future, it’s whether everything should become something people can bet on.

The US is still defining prediction markets 

This week, the Commodity Futures Trading Commission closed consultation on its proposed framework for prediction markets. They received more than 1,400 submissions from lawmakers, regulators, sports leagues, gambling operators, tribal gaming organisations and prediction market companies themselves.

Prediction market operators argue they are offering regulated financial products that help discover information through market pricing. Almost everybody else from that list contends that sports event contracts are simply another form of gambling that should remain subject to existing betting laws.

Sports leagues in particular have concerns about integrity, warning that certain markets could increase the risk of manipulation, insider information and athlete harassment.

When key stakeholders can’t agree what a prediction market is, it dramatically slows down policy making.

Britain has the chance to act

The UK is in a slightly different position. At present, Betfair is arguably the closest legal option that the UK has for prediction market gambling. Allowing users to lay bets means that you can theoretically bet on anything. Betfair operates as a betting site and holds a licence with the UK Gambling Commission.

The Gambling Commission's position is that operators offering sports event trading would require the appropriate gambling licence. Beyond that, however, there has been little public discussion about how offshore prediction markets should be treated if UK consumers continue to access them.

Thanks to the UK’s well-established and well-regulated betting market, prediction markets can’t capitalise on the ‘gap in the market’ in quite the same way that they have in the US. While the Gambling Commission has made clear that sports event trading would require a gambling licence, the Financial Conduct Authority has previously prohibited binary options for retail consumers.

Yet despite that regulatory position, offshore prediction markets remain accessible to determined UK users willing to use VPNs and cryptocurrency. That raises a question. If British consumers can already access these platforms, is waiting for them to become mainstream really the best regulatory strategy?

Britain has the unusual advantage of watching the American experiment unfold from a distance. The question is whether policymakers use that head start, or wait until prediction markets become too large to ignore.