EU’s financial regulator have issued a firm warning to companies operating prediction markets, clarifying that certain contracts fall under existing binary options restrictions.
Europe prediction markets
The European Securities and Markets Authority (ESMA) has warned that prediction markets with binary yes-or-no outcomes and fixed payouts qualify as restricted financial instruments.
In a statement issued on Friday, ESMA noted the increased offering of event contracts and clarified that such products may fall under existing restrictions on binary options.
This is the first time the EU’s financial markets regulator has spoken out on prediction markets, amid a huge rise in popularity and activity across the vertical in both North America and Europe.
