Spain Opens Proceedings Against Kalshi, Polymarket Over Prediction Market Compliance

Spain's gambling regulator, the Direccion General de Ordenacion del Juego (DGOJ), has opened disciplinary proceedings against prediction market operators Kalshi and Polymarket, citing failures in identity verification, minor protection, and self-exclusion controls, according to legal experts speaking at a Gaming in Europe webinar reported by European Gaming.

Why it matters

The action marks the first concrete enforcement by a European regulator against major prediction platforms, potentially setting a precedent for how these hybrid financial-gambling products are treated across the region. The platforms could face sanctions if the DGOJ imposes penalties, per the webinar.

The state of prediction markets

Prediction markets have grown rapidly. Josh Hodgson of H2 Gambling Capital noted on the webinar that total volume reached $77bn in Q1 2026, with sports predictions accounting for $40bn. These sports predictions include markets for games such as cleveland browns vs new york jets match player stats and seahawks vs new york jets match player stats, which have driven significant engagement. That growth has attracted regulatory scrutiny across Europe.

DGOJ proceedings in detail

The DGOJ's proceedings target Kalshi and Polymarket for operating without a Spanish gambling license. The regulator identified insufficient know-your-customer (KYC) checks, exposure of minors to gambling-like content, and inadequate self-exclusion tools as key violations. The proceedings are part of a broader push by European regulators. nine regulators have issued warnings about prediction markets, according to a report by Gaming Tech Law.

Contrast with U.S. approach

In the United States, the Commodity Futures Trading Commission (CFTC) has reaffirmed its exclusive jurisdiction over prediction markets. The CFTC filed a brief asserting that these markets fall under its regulatory authority, distinguishing the U.S. approach from Europe's emerging gambling-based framework. The CFTC stated that prediction markets are subject to the Commodity Exchange Act, not state gambling laws.

Player impact

For players in Spain using Kalshi or Polymarket, the proceedings could lead to service restrictions or account suspensions if the platforms are forced to comply or exit the market. Spanish users may find prediction markets for events including NFL match player stats, such as atlanta falcons vs new england patriots match player stats, unavailable if the platforms restrict access. Across Europe, other regulators are monitoring the case closely, and similar actions could follow in jurisdictions that classify prediction markets as gambling.

What remains unclear

The exact date when the DGOJ initiated the proceedings has not been confirmed. Neither Kalshi nor Polymarket have issued formal responses to the allegations. The number of Spanish users affected remains unknown. It is also unclear whether the platforms will challenge the proceedings or seek a Spanish gambling license, which would require compliance with cross-betting regulations.

What happens next

The disciplinary outcome is expected between September and October 2026, according to the webinar. The decision will likely inform how other European Union member states regulate prediction markets, especially in jurisdictions that treat them as gambling rather than financial products. Players and operators should watch for updates from the DGOJ and the platforms' next moves.