Polymarket Launches European Lobbying Push For Financial Services Status

Highlights

• Polymarket is lobbying European regulators to be classified as a financial services company rather than a gambling operator.
• The prediction market operator is seeking a regulatory pathway under the EU’s Markets in Financial Instruments Directive (MiFID).

Prediction market operator Polymarket has stepped up its lobbying efforts across Europe as it seeks to operate under financial services regulation rather than gambling laws.

According to reports, Polymarket has been engaging with regulators in the UK and European Union, including the European Securities and Markets Authority (ESMA) and the European Commission. 

Polymarket is reportedly arguing that certain prediction market contracts should be treated as financial instruments under the EU’s Markets in Financial Instruments Directive (MiFID) framework.

The move comes amid increasing regulatory scrutiny of prediction markets across Europe. In June, nine European gambling regulators announced a joint initiative targeting unlicensed prediction market platforms.

France’s gambling regulator previously banned Polymarket after determining that its services could constitute unlicensed gambling. In Italy, Polymarket was also listed as a prohibited site by the country’s gambling regulator.

ESMA has separately confirmed that certain binary prediction contracts with fixed payouts can qualify as financial instruments. Contracts connected to areas such as equities, indices, interest rates, currencies and commodities can fall within the scope of MiFID II.

The regulatory position differs between European markets. In the UK, the Financial Conduct Authority oversees certain financial and climatic event contracts, while sports and political prediction markets fall under gambling regulation.

Polymarket has also joined Blockchain for Europe as it increases its engagement with policymakers.

The company’s European strategy could therefore depend on how regulators ultimately define and classify prediction market products across financial and gambling frameworks.

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