Spain blocks Polymarket and Kalshi over missing gambling licences

A three-to-four month suspension while Madrid’s gambling watchdog investigates makes Spain the latest European jurisdiction to treat prediction markets as unlicensed betting.

Spain has temporarily blocked the US-based prediction markets Polymarket and Kalshi for operating in the country without a gambling licence, according to an order published in the Spanish state gazette on Tuesday by the Consumer Rights Ministry, which has authority over the country’s gambling watchdog.

The ministry has opened a formal investigation into both companies for allegedly breaching Spanish rules that require online operators offering money-staked wagers on uncertain outcomes to hold administrative authorisation. The suspension is expected to remain in place for three to four months while the probe runs.

The order cites the absence of the technical and consumer safeguards required of licensed operators, including identity verification and access controls intended to keep minors off the platform.

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Spain joins a lengthening list of European jurisdictions to treat prediction markets as a form of gambling. France’s national gaming authority blocked Polymarket in late 2024, ruling that its operation amounted to unlicensed gambling, and the same year Belgium, Poland and Italy issued bans of their own.

The Dutch gambling regulator KSA threatened Polymarket with fines of €420,000 per week if it continued serving Dutch users without a licence, the largest single enforcement threat from a European regulator so far.

There is no harmonised EU framework for event contracts; every member state applies its own gambling or financial rules.

The Spanish action comes against the backdrop of a coordinated international tightening. India’s electronics and IT ministry issued a formal blocking order against Polymarket on 21 May, instructing internet service providers to cut access at the network level, with a similar order for Kalshi reportedly prepared within days.

India formally reclassified prediction markets as “money games” under online gaming rules that took effect on 1 May. Brazil and Indonesia have also issued bans in recent weeks. The Spanish suspension is the third European-level enforcement action of 2026, after a Netherlands escalation in February and a Belgian referral in March.

Polymarket and Kalshi sit at the centre of an unusually fast-growing category. The two platforms together processed several billion dollars in trading volume around the 2024 US presidential election and have continued to expand into sports, geopolitics and corporate-event contracts.

The economist Robin Hanson, who developed much of the theoretical case for prediction markets, has argued in recent months that the platforms are functioning largely as intended, even as both companies move to ban insider-style trading on news the betting parties helped produce.

The legal frame in Europe and the legal frame in the US continue to diverge sharply. Kalshi operates as a CFTC-regulated event-contracts venue in the US and has positioned itself, with some success, as a financial market rather than a gambling product. European regulators have shown little appetite for that distinction.

The Spanish ministry’s position, in effect, is that a wager on an uncertain future outcome is gambling regardless of how it is structured behind the scenes. The Spanish action falls back on the same logic now repeated across Paris, Brussels, Warsaw, Rome and The Hague.

Neither Polymarket nor Kalshi had issued a public response by the time of publication. The Spanish probe is scheduled to conclude in late summer.