Gibraltar is the First Country in the World to Establish a Regulatory Framework for Prediction Markets

Gibraltar is the first to introduce rules for the new market

On July 13, 2026, Gibraltar's new regulations governing prediction market operators officially took effect, making it the first jurisdiction in the world to introduce a dedicated regulatory framework for the industry.

Prediction markets allow users to trade contracts based on the likelihood of future events. Rather than relying on the traditional bookmaker model, these platforms typically function as exchanges, where contract prices rise or fall according to participants' expectations of an event's outcome.

In recent years, prediction markets have emerged as one of the fastest-growing segments of the digital economy. The sector has expanded particularly rapidly in the United States, where platforms such as Kalshi and Polymarket let users speculate on political elections, sporting events, and a wide range of other outcomes. Despite this growth, U.S. regulators have yet to establish a comprehensive regulatory framework for the industry.

Gibraltar aims to capitalize on this regulatory gap by positioning itself as the first jurisdiction to offer a dedicated licensing regime for prediction market operators.

The new framework was introduced by Minister for Justice, Trade, and Industry Nigel Feetham, who said the regime is designed to attract innovative businesses while simultaneously ensuring risk control. Licensed operators will be supervised by the Gambling Division within the Ministry of Justice.

The first company to obtain a license was Predict Street (ADI Predictstreet website). Wire Markets, affiliated with WagerWire, also received in-principle approval to operate.

How will the new regulations for prediction markets work

Unlike traditional betting, prediction markets will not automatically be classified solely as gambling or financial instruments. The regulator will consider the specifics of each product individually.

The main areas of oversight will be:

• User protection.
• Prevention of money laundering and financial violations.
• Ensuring market integrity.
• Control over operators' operating systems.
• Transparency in determining forecast results.

One of the key elements of the new regime will be oversight of the events on which users can make predictions. Operators will be required to ensure the objectivity of conditions and prevent manipulation.

The regulator will be able to restrict the launch of individual markets if they pose a public risk. Events related to criminal activity, terrorism, armed conflict, death, or serious injury may be prohibited.

The new system also provides for the establishment of a separate oversight mechanism specifically for websites hosting prediction markets.

How new rules could change the prediction market

Gibraltar's move could become a significant milestone in the evolution of the prediction market industry. While many jurisdictions are still debating how to regulate these platforms or have not yet determined their status, Gibraltar has chosen to establish a dedicated legal and licensing framework for the sector.

The government hopes the new regime will attract operators looking for regulatory certainty, particularly companies developing blockchain-based and digital financial products. Alongside Predict Street and Wire Markets, the framework is expected to appeal to additional prediction market operators considering new licensing jurisdictions.

The long-term success of Gibraltar's approach will depend on its ability to balance innovation with effective regulatory oversight. As other countries continue to develop their own policies, regulators will also need to define the boundary between prediction markets and traditional gambling. If Gibraltar's framework delivers the intended results, it could become a blueprint for other jurisdictions and accelerate the industry's transition toward a more mature and well-regulated market.