Spain has ordered the blocking of Polymarket and Kalshi while regulators investigate whether the companies violated the country’s gambling laws, escalating a growing international crackdown on online prediction market platforms that have surged in popularity over the past year.
The Spanish Ministry of Social Rights, Consumer Affairs and Agenda 2030 said it opened disciplinary proceedings against the two firms because they were allegedly operating in Spain without the administrative authorization required under Spanish gambling regulations. The country’s Directorate General for Gambling Regulation (DGOJ) also ordered internet providers to block access to the platforms as a “precautionary measure” pending the outcome of the investigation.
According to the ministry, the proceedings are expected to last between three and four months. Regulators said the disciplinary notices had to be published through Spain’s Official State Gazette after attempts to contact the companies at their foreign business addresses were unsuccessful.
In a press release, the ministry said Polymarket and Kalshi are “prediction platforms where bets are placed” and are allegedly operating in Spain “without the required administrative authorization, thus violating gambling regulations,” per an English translation.
Spanish officials framed the case as part of a broader European regulatory approach that treats prediction markets as gambling operations when users wager on uncertain future outcomes. “The DGOJ reminds the public that in Spain, in line with other European jurisdictions, prediction markets are considered gambling when bets are placed on uncertain future outcomes,” the ministry said. “Therefore, operating them in Spain requires obtaining a specific administrative license.”
The ministry also warned that unauthorized operators fail to provide the consumer protections required under Spanish law, including “identity verification systems, mechanisms to control access to minors and people who are self-excluded or prohibited from gambling, or the supervision standards necessary for the protection of users.”
Related: Federal Prosecutors Seeking Information on Possible Insider Trading on Polymarket
Spain’s action comes as governments and regulators around the world increasingly confront the rapid rise of prediction markets, which allow users to trade contracts tied to the outcomes of elections, geopolitical events, sports contests and economic indicators. While supporters argue the platforms function as information markets that improve forecasting, regulators in many jurisdictions view them as a form of online gambling subject to licensing and consumer protection requirements.
As reported by Decrypt, Spain joins a growing list of countries that have moved to block or restrict the platforms. Indonesia recently blocked access to Polymarket after officials concluded the platform constituted gambling under Indonesian law, even when wagers were conducted using cryptocurrency. Authorities in Thailand and India have also taken steps aimed at limiting access to the services.
The regulatory scrutiny comes amid explosive growth for the industry. Decrypt reported that Polymarket generated more than $5 billion in monthly trading volume in May, while Kalshi generated roughly $13.7 billion, citing data from Dune Analytics. The firms’ valuations have also climbed sharply, with Polymarket reportedly seeking a $15 billion valuation and Kalshi recently raising capital at a $22 billion valuation.
The companies are also facing mounting pressure in the United States, where lawmakers and regulators have begun questioning whether existing commodities and gambling laws adequately address the platforms’ activities.
That scrutiny has intensified following allegations of insider trading and market manipulation tied to geopolitical prediction markets, per Decrypt. In one recent case, a U.S. soldier was charged with allegedly using confidential information to place bets on Polymarket related to the potential removal of Venezuelan President Nicolás Maduro, reportedly earning more than $400,000.
House Republicans led by Oversight Committee chair Rep. James Comey (R-KY) have also launched an investigation into Polymarket and Kalshi.
Spain’s intervention underscores the increasingly fragmented global regulatory environment facing prediction market operators. While some jurisdictions have explored integrating event contracts into regulated financial markets, others are moving to classify the platforms squarely within existing gambling frameworks, raising the prospect of additional enforcement actions as the industry continues its rapid expansion.
