European Lotteries urges regulatory coherence as prediction markets expand
EL calls for coordinated financial and gambling supervision to close legal gaps in Europe
Key Takeaways
- European Lotteries issued a statement in Brussels on 30 September 2026 asking for regulatory coherence for prediction markets.
- EL argues that legal classification and economic risk — not product name or technology — should determine regulatory treatment.
- ESMA acknowledged that event contracts can constitute bets under national gambling law, a point EL welcomed to support regulatory coordination.
- Gambling remains a national competence, which requires cooperation between financial and gambling authorities to avoid inconsistent protections.
European Lotteries issued a statement in Brussels on 30 September 2026 calling for a coherent regulatory approach to prediction markets in the European Union. EL asked authorities to close potential legal gaps and prevent these products from weakening consumer safeguards; it stressed that legal classification and economic risk should determine regulatory treatment, not commercial labels or underlying technology.
What prediction markets are and why European Lotteries is concerned
Prediction markets let users take positions on future outcomes — from elections and macroeconomic data to sporting events — by trading event contracts. European Lotteries (EL) says regulatory assessment should focus on the legal characteristics and the economic substance of those contracts, as well as the risks posed by their offer.
Under current European frameworks, event contracts that meet the definition of a financial instrument under the Markets in Financial Instruments Directive (MiFID II) are subject to financial regulation. Other contracts that are not financial instruments remain governed by national gambling law. EL reminds that classification as a financial instrument does not automatically exempt a product from compliance with national betting rules.
Coordination across fields: financial and gambling supervision
EL emphasised that gambling remains a national competence, so the legality of a prediction market can vary between Member States. That variation requires operational cooperation between financial supervisors and gambling authorities to avoid regulatory arbitrage or inconsistent consumer protections.
The organisation urged jurisdictions to recognise potential overlap between regulatory regimes and to define coordination mechanisms to resolve questions of competence and enforcement. That interaction should include the exchange of criteria on product classification and risk assessment for vulnerable consumers.
Technology neutrality and the treatment of DLT, blockchain and tokenisation
European Lotteries defended technological neutrality: the adoption of technologies such as distributed ledger technology (DLT), blockchain or tokenisation should not change the regulatory analysis. The organisation asked that technical innovations not be used to evade player or investor protection obligations.
Reaction to ESMA and EL’s public position
EL welcomed recent statements from the European Securities and Markets Authority (ESMA) recognising that event contracts may qualify as bets under national gambling law. ESMA’s observation, EL said, reinforces the need for close coordination between financial and gambling supervisors.
"Prediction exchanges are developing rapidly and regulation must keep pace. Activities presenting similar risks should be subject to similar safeguards," said Piet Van Baeveghem, secretary general of European Lotteries.
"We welcome ESMA’s statement that event contracts can be bets under national gambling law," Van Baeveghem added, advocating coordination between authorities.
Practical enforcement: staying within the European regulatory framework
European Lotteries concludes that prediction markets should remain within the existing European regulatory architecture and that policymakers should prioritise coherent enforcement and compliance. EL warns that leaving classification to a product name or the technology used can create inconsistencies in consumer protection. For regulators and stakeholders, see our section on [regulation](/regulation).
Implications for operators, regulators and investors
For operators and suppliers EL’s guidance means product design and marketing decisions must consider both financial and gambling rules applicable in each market. National regulators will need to coordinate with financial counterparts to decide where each product fits and what protection requirements apply.
Investors and platform owners using DLT or tokenisation do not gain automatic regulatory exemption; legal classification and economic risk analysis remain decisive.
Where to dig deeper
Practical questions about how a specific product fits MiFID II or national gambling law will continue to arise in courts and among supervisors. Meanwhile, authorities and industry will need to establish formal dialogue channels and shared criteria to minimise regulatory gaps and ensure consistent safeguards for consumers across Member States. Relevant industry stakeholders should follow related [news](/news) and [b2b](/b2b) developments.
Miguel Sandoval, Regulatory correspondent.
Frequently Asked Questions
What did European Lotteries request in its 30 September 2026 statement?
European Lotteries called for a coherent regulatory approach to prediction markets and urged closing legal gaps that could weaken consumer protections. EL requested that classification depend on legal nature and economic risk rather than product labels or technology.
Can blockchain technology change how a prediction market is regulated?
No. European Lotteries defended technological neutrality, stating that DLT, blockchain and tokenisation should not alter regulatory assessment. The organisation insists technology cannot be used to evade protection obligations.
What role did ESMA play in the discussion on event contracts?
The European Securities and Markets Authority stated that event contracts may qualify as bets under national gambling laws. European Lotteries welcomed that statement as supporting the need for coordination between financial and gambling supervisors.
Tags
About the author
Miguel Sandoval
Regulatory Affairs Correspondent
Miguel Sandoval tracks gambling legislation, licensing, and regulator enforcement — from Spain's DGOJ and the Latin American authorities to the UKGC, the MGA, and the state-by-state map in North America. The reports answer three questions precisely — what changed, where, and who it affects — with jurisdictions, dates, and penalties cited exactly as published. Operators and compliance officers read Miguel Sandoval to know which rulebook moved before their next meeting.
More from Miguel Sandoval
