Prediction Market Licensing

What Is Prediction Market Licensing?

Prediction market licensing is the authorisation a business needs to run a platform where users buy and sell standardised contracts that pay out on the outcome of a future event. Those contracts are called event contracts, and the regime that applies depends on whether the host country treats them as bets, as derivatives, or as financial instruments.

The classification turns on what the contract resolves on. Where the underlier is a sporting result, an election or a cultural outcome, regulators usually treat the product as a bet or an event contract. Where it resolves on a financial-market variable such as an index level, an interest rate or a commodity price, it is likely a binary option and therefore a financial instrument under the MiFID II framework. Get the product specification clean on day one and you save months in licensing later. Getting it wrong is the most common reason an operator spends the first quarter of an application discovering it filed under the wrong regime.

Prediction markets are not fixed-odds sports betting, where the operator sets the price and carries the risk, and they are not retail binary options, whose marketing the European Securities and Markets Authority (ESMA) and the UK Financial Conduct Authority effectively shut down. They sit closer to a peer-matched exchange: users trade against each other, the platform earns fees on volume, and the venue does not take the other side of the bet. For operators not targeting the United States, the practical home for these products is a gambling or offshore betting-exchange licence, and that is where we deliver.

Who Needs a Prediction Market Licence?

You need a prediction-market or event-contract licence if you run a platform that matches users on the outcome of a future event for a fee, whether it settles in fiat, in stablecoin or on-chain. The clients we form and licence usually fall into one of three profiles, and each one points to a different licence.

The clearest case is the crypto-native founder building a peer-to-peer event-contract product that matches users on yes-or-no contracts, settles in stablecoin and earns fees on volume without ever taking the other side. For an operator that is not chasing US retail, the realistic home is an offshore or gambling licence run with disciplined geo-blocking, and that is the bulk of the work we do here. We form the company, obtain the licence and stand up the banking that makes it usable.

The second profile is the gambling or iGaming operator adding event contracts as a near-adjacent product. If you already hold a betting-exchange or betting-intermediary licence in your market, you may not need a separate authorisation there at all, and we help you confirm the boundary before you spend on one you do not need. Where you do need a fresh licence in a market you want to reach, we obtain it.

The third profile is the fintech business extending into prediction markets alongside an existing trading or payments product. Here the questions are corporate structure, where the licensed entity sits and how settlement and banking are arranged, and those are exactly the parts we deliver directly.

Adjacent products sit on their own pages. Chance-based gambling is on our gambling and iGaming licensing page; CFD and forex products are on our forex broker licensing page. The teams overlap; the regimes do not.

Where We Get You Licensed

For prediction-market operators that are not chasing US retail, the practical homes are the gambling and offshore betting-exchange regimes. These are the regimes we deliver in directly. We lead with Anjouan, Curaçao and the Isle of Man because that is where we form the company, file the licence and place banking ourselves, with our own team and a controlled network of in-country specialists we work with directly.

Anjouan

Anjouan is the only regime whose published activity list explicitly names prediction markets alongside online casinos, sports betting and poker, which makes it the cleanest fit for a crypto-native event-contract product going to market quickly with a non-US, non-UK user base. Files complete in weeks rather than months. The practical limit is banking: an Anjouan-only structure rarely reaches a tier-one acquirer on its own, so we pair it with an EU or EEA payment-agent company to open fiat rails through a licensed EU EMI, while crypto on-ramps accept the licence directly. We build that layered structure as part of the mandate rather than leaving you to discover the gap after the licence is granted.

Curaçao

Curaçao is the workhorse offshore choice for prediction markets and now runs under the Landsverordening op de Kansspelen, the new direct B2C and B2B regime supervised by the Curaçao Gaming Authority. The substance bar has risen under the new law: a resident managing director, full beneficial-owner disclosure, on-island data hosting and AML alignment with the FATF Recommendations. We handle the company, the resident director, the hosting arrangement and the application together, so the substance is real and the file holds up. Curaçao banks through second-tier acquirers and EMIs that price for the category, which we arrange alongside.

Isle of Man

The Isle of Man’s Online Gambling Regulation Act licence covers prediction-market activity and is the choice for operators that want a credible, bankable, zero corporate-tax base with real substance behind it. The Gambling Supervision Commission runs a thorough but predictable process, and a complete file clears in roughly ten to twelve weeks. Isle of Man structures reach tier-one EU EMIs and acquirers more readily than offshore-only ones, which is the main reason operators choose it over a cheaper licence. We form the company, build the substance and file.

European gambling routes (reference)

For an EU and EEA-targeting operator, two further gambling routes are worth knowing. The Malta Gaming Authority’s Type 3 licence covers exchanges where the operator earns a commission rather than carrying player risk, a clean fit for peer-matched mechanics, and it carries genuine institutional credibility. Estonia’s gambling “toto” category, supervised by the Estonian Tax and Customs Board, covers games whose outcome turns on an event outside the operator’s control, which fits prediction markets well and gives an EU-licensed base. Both require a local company, a resident presence and capital. Talk to us about whether an EU route is worth the additional substance for your model.

UK and Gibraltar (reference)

The UK Gambling Commission confirmed in February 2026 that prediction markets fall within the existing definition of a betting intermediary under the Gambling Act 2005, and that running one without a UK licence is a criminal offence. Where contracts settle on financial underliers, Financial Conduct Authority permissions may also be triggered. Gibraltar became the first jurisdiction in the British zone to issue a dedicated prediction-market licence and offers a credible betting-intermediary route with real local substance. If you intend to target UK consumers, you need to be licensed there; an offshore licence does not cover it.

United States (reference only)

In the United States the Commodity Futures Trading Commission regulates event contracts as derivatives, and the only lawful retail-access route is a CFTC-designated contract market, either built over several years or acquired. State-level enforcement of CFTC-listed event contracts remains live and is widely expected to reach the Supreme Court. We do not take US persons as clients and do not deliver US licensing; this section is for context only. If your product would target US users, that is a conversation to have with US derivatives counsel, not with us.

EU financial-instrument route (reference)

Where an event contract resolves on a financial-market underlier such as an FX rate, an interest rate, an equity index or a commodity price, it is likely a binary option and therefore a MiFID II financial instrument, which would require authorisation as an investment firm. ESMA’s binary-options intervention measures make retail marketing of these effectively prohibited across the EU, so this route is realistic only for institutional venues. Most peer-matched prediction markets resolve on non-financial outcomes and sit in the gambling regimes above instead, which is the regulatory daylight these products occupy in the EU.

Jurisdiction summary

The table groups the routes by regime. We deliver the offshore and Isle of Man routes directly; the others are shown for context, with the US reference-only.

Markets that need their own licence

Some markets cannot be reached from an offshore base. The United States requires a CFTC-designated contract market for event contracts, and we do not serve it. The United Kingdom requires a UK Gambling Commission licence, with criminal liability for operating without one. Most major EU member states, including France, Germany, Italy, the Netherlands, Poland, Spain and others, effectively restrict the current generation of prediction-market operators under national gambling law, so reaching those consumers means a local licence, not an offshore one. We are candid about this at the outset rather than selling a licence that does not cover where you actually want to operate.

Key Requirements

Requirements vary by regime, but four things appear in every credible prediction-market file. We build all four into the application so the file holds up the first time rather than coming back with conditions.

Market integrity and surveillance

Every credible regime expects you to monitor your own market: an audit trail, surveillance for manipulation, and a named person responsible for compliance. Gambling regimes set this through their betting-exchange and peer-to-peer categories. The depth differs sharply between an offshore licence and a tier-one gambling licence, and we size the surveillance build to the regime rather than over-engineering it. A prediction market also lives or dies on its event-resolution and oracle design, and we make sure that is documented before the regulator asks.

AML, KYC and financial-crime controls

Wherever you are licensed, the operator is a regulated obligated entity and needs a working AML and KYC programme: customer due diligence, transaction monitoring, sanctions screening and suspicious-activity reporting. EU and EEA operators come under the EU AML rules; offshore operators must align with the FATF Recommendations in practice, not just on paper. The strength of this layer is what banks scrutinise most, so we build it to a standard that survives onboarding rather than the minimum the licence text allows.

Segregated customer funds and capital

Customer funds must be held separately from your working capital, and most regimes require a capital floor and evidence that you can meet peak payout obligations. Malta and Estonia carry defined minimum share capital; Curaçao expects sufficient financial resources to run operations and pay winners. Under-capitalising against real peak payouts is the most common cause of failure in the offshore segment, and we structure the capital position so it is not yours.

Corporate substance and fit-and-proper owners

Substance scales with the regime. The Isle of Man, Malta and Curaçao expect a resident director or managing director, a local compliance presence and fit-and-proper screening of beneficial owners. Estonia requires a local company whose only activity is gambling. Anjouan asks for lighter substance but still vets the operator and technology. We deliver the substance the licence genuinely requires, at the right depth, through our company formation service, rather than the cheapest shell that fails the first review.

How We Work

We run prediction-market licensing as a single mandate: one firm, one point of contact, accountable for the whole thing. We make the regime call, form the company, build the substance, file the licence and place the banking, in parallel rather than one after another, so that capital, substance and banking are ready before the regulator asks for them. Some of this we do in-house; the rest we deliver through a controlled network of in-country lawyers, accountants and licensed specialists we work with directly and have personally vetted. We never hand you to an unverified third party.

The first decision is the regime. A crypto-native operator with a ninety-day target and a non-US user base needs a different answer from an EU-targeting business that wants institutional credibility. We match your product, your target markets and your capital to the licence that actually fits, and we tell you plainly where a route does not work for you. For most operators we form and licence, the home is Anjouan, Curaçao or the Isle of Man.

Once the regime is set, we form the company and build the substance in parallel with the application. For Curaçao that means a local company with a resident managing director and on-island hosting in place before the file goes in. For the Isle of Man it means a substantive local presence. For an Anjouan structure it means the layered EU or EEA payment-agent company that makes fiat banking reachable. We deliver the substance the licence requires at the right depth through our company formation service, then we file the application and deal with the regulator directly until the licence is granted.

Banking runs alongside the licence, not after it. A licence with no banking is a certificate on the wall, and prediction markets are a high-risk category that many institutions decline on sight. We arrange banking with institutions that understand event-contract and peer-matched models, typically through a licensed EU EMI or a category-aware acquirer, and we build the structure that makes onboarding realistic. Banking is one of our core services in the mandate, handled through our high-risk business accounts service. The outcome we deliver is that you are formed, licensed and banked.

We are candid about our limits. We do not serve US persons and we do not deliver US derivatives licensing; if your product would target US users, that belongs with specialist US counsel. Where a leg of the work sits outside what we deliver ourselves, we say so. Everything we do file, we stand behind.

Frequently Asked Questions

Is a prediction market gambling or a derivative?

It depends where you operate. Most countries outside the United States treat event contracts as gambling, which is why the realistic homes are gambling and offshore betting-exchange licences. In the United States they are derivatives, supervised by the CFTC. The UK Gambling Commission has confirmed prediction markets fall within its betting-intermediary definition. Where a contract resolves on a financial-market variable, it is more likely a financial instrument. We make the classification call with you before anything is filed, because it sets the regime for the life of the business.

How is a prediction market different from sports betting and binary options?

A sportsbook sets the odds and carries the risk on the other side of the bet. A prediction market matches users against each other and earns a fee on volume without taking a position. A binary option pays a fixed amount on a yes-or-no outcome and is a regulated financial instrument whose retail marketing is effectively banned across the EU and the UK. Prediction markets sit closest to a peer-matched exchange, which is why gambling betting-exchange categories are the cleanest fit for most operators.

Which jurisdiction do you recommend?

For most operators not targeting US or UK consumers, we deliver in Anjouan, Curaçao or the Isle of Man. Anjouan is fastest and explicitly names prediction markets; Curaçao is the workhorse offshore route under its new regime; the Isle of Man gives a credible, bankable, zero corporate-tax base. The right one depends on your users, your banking needs and how much substance you are prepared to carry. Book a consultation and we will recommend a route and tell you plainly where one does not fit.

Can an offshore licence let me onboard EU and UK users?

Not lawfully. The UK requires a UK Gambling Commission licence, with criminal liability for operating without one, and most major EU member states effectively restrict the current generation of prediction-market operators under national gambling law. Reaching those consumers means a local licence in each market, not an offshore one. We tell you this at the outset so you do not buy a licence that fails to cover where you actually want to operate.

Will my licence come with banking?

We arrange it as part of the mandate. Prediction markets are a high-risk category and many institutions decline them on sight, so banking has to be designed alongside the licence, not bolted on afterwards. We work with a licensed EU EMI and category-aware acquirers, and for an offshore-only structure we add the EU or EEA payment-agent layer that makes fiat rails reachable. A licence with no banking is just a certificate on the wall, so we treat banking as a built-in part of getting you operating.

Banking & Payments

A company and a licence still need a bank account

Banking is one of our three core services. We help high-risk and regulated businesses open the bank and payment accounts that others refuse: we work directly with EU EMIs, payment institutions and crypto-aware banks, confirm appetite before you apply, and make the introduction. Take it with your company and licence, or on its own.

Explore banking & payments →

Related Services

• Gambling & iGaming Licensing: Gambling licences in Anjouan, Curaçao, the Isle of Man, Kahnawake and Tobique
• Forex Broker Licensing: Forex and CFD broker licensing
• Crypto Licensing: VASP, CASP and MiCA authorisations
• Company Formation: The corporate substance behind every licence
• High-Risk Business Banking: Banking arranged alongside the licence