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Spain Blocks Polymarket and Kalshi During Gambling Probe

Spain Blocks Polymarket and Kalshi – Gambling Regulator Investigates Unlicensed Operations

Key Takeaways

• Spain has ordered internet service providers to block access to Polymarket and Kalshi during an ongoing investigation.
• The Dirección General de Ordenación del Juego (DGOJ) has opened sanctioning proceedings over alleged unlicensed gambling activity.
• The temporary block is expected to last three to four months.
• Authorities classify prediction markets as gambling because they involve bets on uncertain future outcomes.
• Users attempting to access the platforms from Spain are expected to receive warnings about unlicensed websites.

Spain Orders Temporary Access Block During Regulatory Investigation

Spain has moved to restrict domestic access to prediction market platforms Polymarket and Kalshi as regulators examine whether the companies have been operating without the required national gambling licenses.

The measure was announced by the Ministry of Consumer Rights and formally published in Spain’s Official State Gazette. According to the ministry, the country’s gambling regulator, the Dirección General de Ordenación del Juego (DGOJ), has initiated sanctioning proceedings against the two US-based operators.

The DGOJ alleges that both platforms offered services in Spain without obtaining the mandatory administrative authorization required under Spanish gambling law. As a result, internet service providers have been instructed to block access to the websites. The temporary restriction is expected to remain in place for three to four months while the investigation continues.

Users in Spain who attempt to visit the platforms are expected to receive warning notices stating that they are trying to access an unlicensed gambling website.

Regulatory Basis: Prediction Markets Classified as Gambling

The DGOJ has stated that prediction markets fall within Spain’s gambling framework because they involve placing bets on uncertain future outcomes. Under this interpretation, operators offering such products to Spanish residents must hold specific licenses.

Authorities argue that platforms operating without authorization do not provide several protections required under national law. These include identity verification systems, safeguards to prevent minors from accessing gambling services, controls covering self-excluded or banned individuals, and other oversight mechanisms designed to protect consumers.

According to officials, previous attempts to notify the companies at known foreign addresses were unsuccessful. As a result, regulators issued formal notices through publication in the state gazette.

For users, the classification has practical consequences. If a platform is considered a gambling operator under Spanish law, it must comply with licensing, technical standards, and consumer protection rules before legally offering services in the country.

How Polymarket and Kalshi Operate

Polymarket and Kalshi enable users to trade positions on the outcomes of future events. Instead of placing traditional sports or casino wagers, participants take positions on whether a specific event will or will not occur.

Markets offered by the platforms have included elections, geopolitical developments, economic events, and changes in political leadership. Recent examples referenced by authorities include markets on whether Spanish Prime Minister Pedro Sánchez would leave office early and which global political leaders might depart their posts within a given year.

This structure differs from conventional sportsbook or casino models but, according to Spain’s regulator, still meets the legal definition of gambling because participants stake money on uncertain outcomes.

Part of a Broader European Regulatory Response

Spain’s decision adds to actions already taken in several other European jurisdictions. In 2024, French authorities blocked Polymarket after concluding that the platform’s activities were likely incompatible with national law.

Other countries that have restricted access to Polymarket include Germany, Belgium, Portugal, Switzerland, Romania, the Netherlands, and Poland. These measures reflect differing national interpretations of how prediction markets should be treated under existing legal frameworks.

At the same time, not all jurisdictions have opted for outright restrictions. Malta has publicly stated that it is examining the prediction market sector and potential regulatory approaches. Earlier this year, Gibraltar granted a license to its first prediction market operator.

The contrasting approaches illustrate an ongoing debate across Europe. Some regulators classify prediction markets as gambling because users bet on uncertain events. Others continue to assess whether such products may fall within financial market, securities, or commodities regulations.

Sector Growth and Increasing Regulatory Scrutiny

Prediction markets have expanded from a niche online activity into a multibillion-dollar sector. Their visibility increased significantly during the 2024 US presidential election cycle, when event-based markets attracted broader public attention.

The sector’s growth has led to increased scrutiny from regulators. Authorities are examining issues such as licensing requirements, consumer protection standards, and the legal classification of contracts linked to future events.

In Spain, the current proceedings focus specifically on whether Polymarket and Kalshi provided services without the required authorization. Once the investigation concludes, the companies could seek local licensing, challenge the regulatory classification applied to their services, or adjust their offerings to comply with Spanish requirements.

A final ruling from Spanish authorities is expected within three to four months.

Our Assessment

Spain’s temporary block of Polymarket and Kalshi formalizes the country’s position that prediction markets fall under its gambling laws and require prior authorization. For users, the decision restricts access in the short term and highlights the importance of local licensing status when using cross-border platforms. For operators, the case underscores the regulatory uncertainty surrounding prediction markets in Europe, where national authorities continue to differ on whether such products are gambling services or fall under alternative legal frameworks.