Key insights
- Brazil banned 28 prediction market platforms due to non-compliance with betting sector regulations. The National Monetary Council prohibited derivatives linked to sports, online gaming, and political/social outcomes. While this event is isolated to Brazil, it highlights increasing regulatory scrutiny of novel financial instruments globally, which could foreshadow similar actions in other jurisdictions, including the US, albeit with a low probability.
Investing.com -- Brazil has blocked 28 prediction market platforms, Finance Minister Dario Durigan announced Friday, stating these markets do not comply with rules governing the country’s betting sector approved by Congress.
The National Monetary Council on Thursday defined which underlying assets may be used in derivatives trading, banning those linked to sports events, online gaming, or political, electoral, cultural and social outcomes, Durigan said.
"We concluded that prediction markets are neither legal nor regulated in Brazil," Durigan said.
Presidential Chief of Staff Belchior said the measure seeks to protect income and prevent financial losses for the population. "Our goal is to prevent the consolidation of a new, uncontrolled betting market through predictions," Belchior said.
Belchior added that if a company wants to operate in Brazil, it must do so under clear rules that protect the population.
Durigan noted that regulator Anatel may have already blocked the operation of these prediction platforms.
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