In response to a resolution by the National Monetary Council, Brazil’s government has restricted access to 27 websites providing prediction market services such as Polymarket and Kalshi. This move came after the council issued an order prohibiting derivatives tied to sports events, online gambling, and political or social activities.

During a press conference in Brasília, Finance Minister Dario Durigan announced the decision, emphasizing it as part of efforts aimed at safeguarding household savings and tackling increasing consumer debt related to online gambling.

The resolution directs Brazil’s securities regulator, CVM, to formulate specific guidelines for implementing these new regulations. However, contracts associated with economic and financial benchmarks are exempted from this prohibition.

Regulatory Landscape and Implications

Brazil now follows in the footsteps of countries like France, Hungary, Portugal, and others that have applied gambling laws to prediction market platforms, necessitating operational licenses that these services currently lack. The U.S., conversely, has supported state-level efforts by the Commodity Futures Trading Commission (CFTC) to prevent such closures, asserting federal jurisdiction.

Kalshi, one of the leading prediction market players, had intended to enter Brazil’s market but is now reassessing its strategy in light of this resolution. Polymarket did not respond promptly to inquiries for comments.

This regulation also impacts domestic market plans. The São Paulo Stock Exchange (B3) had been considering introducing prediction market contracts, including those based on economic indicators and election outcomes leading up to the 2026 presidential elections. However, these plans have now been shelved in line with the new restrictions.

Durigan underscored that the government will pursue more stringent measures to mitigate the social issues arising from unregulated gambling.