Spain’s gambling authority has ordered the temporary blocking of prediction market platforms Polymarket and Kalshi, citing unlicensed operations within the country. The Dirección General de Ordenación del Juego (DGOJ) announced the action on Tuesday as it launches formal sanctioning procedures against both operators. A definitive ruling is expected within three to four months.

Regulatory Stance on Prediction Markets

The DGOJ’s move reflects an increasingly assertive approach to prediction markets across Europe. Spain’s regulator has classified these platforms as gambling activities because they involve wagering on uncertain future outcomes, bringing them squarely under the country’s existing gambling licensing regime. Neither Polymarket nor Kalshi held the required administrative licences to operate legally within Spanish jurisdiction.

The regulator identified significant consumer protection gaps on unauthorised platforms. Inadequate identity verification systems, insufficient controls preventing access by minors and self-excluded players, weak supervision standards overall. Notably, initial attempts to serve formal notice at known foreign addresses proved unsuccessful.

The European Regulatory Patchwork

Spain’s enforcement action reflects the broader regulatory fragmentation surrounding prediction markets across the continent. European jurisdictions have adopted conflicting approaches, with some applying gambling law while others explore whether these platforms fall under financial services or commodities regulation.

Polymarket has faced enforcement action in multiple countries. France banned the platform in 2024 on grounds of suspected legal violations. Germany, Belgium, Portugal, Switzerland, Romania, the Netherlands and Poland have also implemented blocks. The contrast is striking: Malta and Gibraltar are actively developing licensing frameworks, with Malta’s government signalling exploration of potential regulation and Gibraltar having already licensed its first prediction market operator this year.

Path Forward for Operators

The DGOJ’s enforcement notice, published in Spain’s official gazette, leaves operators with distinct options following the final ruling. Polymarket and Kalshi may seek proper Spanish licensing, pursue legal challenge against their gambling classification, or modify their service offerings to achieve regulatory compliance.

The tension between platforms positioning themselves as forecasting or financial tools and regulators applying gambling protections remains unresolved. Spain’s intervention suggests the consumer protection argument is winning out in at least one major European market.

What the team thinks

Carl Mitchell says:

Spain’s crackdown on Polymarket and Kalshi is a textbook example of regulators playing catch-up with innovation, and while I understand the licensing concerns, the DGOJ might be missing an opportunity to create a proper framework for prediction markets rather than just blocking them outright. What’s curious here is that unlike traditional slots operators, these platforms operate in a greyish regulatory zone across Europe, and Spain could actually position itself as a leader by establishing clear rules that protect consumers while allowing the space to grow legitimately. The real question Ashworth should have dug into is whether Spain’s approach will push these operators underground or spark a broader EU conversation about how prediction markets fit into modern gaming regulation.