Kalshi and Polymarket are blocked in Brazil for operating as unregulated betting sites.
The Ministry of Finance has ordered the suspension of activities of predictive market companies in Brazil starting in April 2026. The measure affects companies such as Kalshi and Polymarket, which sell contracts based on predictions about elections, sporting competitions, and events involving celebrities.
Brazilian authorities have concluded that these platforms sell sports predictions without complying with the requirements applied to regulated betting sites, according to information from Folha de S.Paulo. The ban was implemented after an assessment that the companies operate without observing the established rules for the betting sector. The affected platforms sell "yes or no" type contracts on real events. Buyers place bets on football matches, reality show finals , celebrity wedding dates, and election results.
The companies are not respecting the rules imposed on betting sites . Among the requirements that have not been met are the payment of a license fee of 30 million reais, the collection of taxes destined for federal revenue, and compliance with anti-money laundering regulations.
Kalshi's co-founder, 29-year-old Brazilian Luana Lopes Lara, stated that the company hopes to reverse the government's decision.
Ministry of Finance reports 26 companies blocked.
The Ministry of Finance concluded that prediction markets operate under the same logic as betting sites . Kalshi and Polymarket should follow the same rules as betting sites, including the payment of a 30 million reais concession fee.
The platforms should also respect the restriction on topics such as sports and the results of virtual games like Fortune Tiger. Regular betting sites cannot offer bets on elections.
The Brazilian Ministry of Finance identified 26 other smaller companies operating as prediction marketplaces in Brazil. All of them were shut down.
Brazilian users of these platforms lost access to the services offered by the companies. Betting sites regulated in Brazil were not affected by the measure.
The sector generated US$51 billion in revenue in 2025.
The market moved $51 billion in 2025. The American consulting firm Bernstein projects that the global advance of Kalshi and Polymarket could leverage the forecasting market to a level of $1 trillion in terms of money flow by 2030.
The largest companies in the forecasting market are Kalshi and Polymarket. Both have market valuations exceeding $10 billion. The companies were founded by young people under 30 years old.
Kalshi was valued at $22 billion in February during its latest funding round. In that operation, the company received $1 billion from the Coatue Management fund.
The platform established itself as dominant in the sector after obtaining approval from the CFTC ( Commodity Futures Trading Commission ) in the United States. Its event contracts totaled $52 billion in volume.
Kalshi's stock valuation surge after selling bets on the US elections has made its Brazilian co-founder the youngest person in the world to amass a fortune of $1 billion. This information was published by Forbes magazine.
Polymarket raised $400 million in April. The company was valued at $15 billion. This valuation represents growth from the $9 billion recorded at the end of 2025. At that time, the company received investments from Intercontinental Exchange (ICE), owner of the New York Stock Exchange.
Restrictions affect users in 53 countries.
In total, users from 53 countries cannot access prediction markets. Generally, these are nations with betting regulations that have restricted or blocked access to prediction markets without a local license.
The United Kingdom requires a license from the Gambling Commission for any prediction market offering. The French gaming authority initiated bans on Polymarket in 2024 for lack of authorization. Italy and Australia maintain restrictions on offshore betting sites without a headquarters or legal representation in the country.
Kalshi and Polymarket operated in the country without regulation. The platforms used international remittances to accounts in the United States. Brazilians sent money to the platforms using cryptocurrencies and international cards.
Polymarket has a business page on Instagram dedicated to Brazil, verified by Meta. The audience was restricted to people with access to cryptocurrencies or global accounts, such as Wise.
Companies argue contractual differences.
Companies in the prediction market argue that bonuses for those who correctly predict the outcome are based on the amounts invested, similar to a stock market. The securities can be traded at any time.
Companies in this sector can profit from a fee on the sale of the contract, from the traffic they receive on the internet, and by selling statistical information about the bets.
Betting companies say there is no difference between the prediction market title and a regular bet. Industry entities have been calling for restrictions on prediction markets since the beginning of 2026. In both cases, the bet is on whether something will happen or not. The person wins money if the prediction is correct. The difference is contractual and related to payment.
In betting , the odds of a bet can be determined by the bookmakers themselves or fluctuate with the market, as happens in prediction markets. What changes is the charging of a service fee by the bookmaker, which can be explicit or implicit. The prediction market does not always charge brokerage fees, as it makes money in other ways.
Government identifies violations of local rules.
The Brazilian government claims that Kalshi and Polymarket have neither paid nor respected local regulations against gambling addiction. The companies claim in their advertisements that it is possible to profit from the prediction market. This practice is prohibited.
Brazilian law stipulates that bets can only be placed using Pix. This measure aims to prevent credit card debt and money laundering with cryptocurrencies. These payment methods are available on prediction market platforms.
Experts in electoral law warn that producing statistics about the electoral process should be an activity supervised by the TSE (Superior Electoral Court). The court has already taken down websites that offered this service.
The National Monetary Council Resolution expressly prohibited the offering of derivatives based on sporting, political, social, or cultural events. Simultaneously, the Ministry of Finance reaffirmed that fixed-odds betting is restricted to sporting events and online games.
Leonardo Henrique Roscoe Bessa, a consulting lawyer for the Brazilian Bar Association (OAB), explained the practical consequences of the decision. “The practical effect of these regulations is the legal exclusion of prediction platforms that operate with non-financial themes, such as politics or entertainment. Since they do not fall under the legal concept of sports betting nor the permitted definition of derivatives, these platforms lose the regulatory support to operate in Brazil,” said the lawyer.
Division of responsibilities among regulatory bodies
The Secretariat of Prizes and Betting, linked to the Ministry of Finance, will oversee sports betting and virtual casinos. The CVM (Securities and Exchange Commission) will oversee financial derivatives, such as economic indices or climatic phenomena that may influence agribusiness.
The investment bank XP has partnered with Kalshi. The institution sells futures contracts linked to economic events, such as rising unemployment or falling inflation. The sale of these securities exclusively through the XP platform is still legal.
The market gained prominence by offering bets on the 2024 US elections between Donald Trump and Joe Biden. The sector continued to expand into areas such as sports, cryptocurrencies, celebrities, and, more recently, war-related events.
Reports of compulsive behavior in the United States
In the United States, where prediction markets began to operate, there are reports of people developing compulsive relationships with these platforms. A common consequence of this addiction is debt, as is the case with gambling.
American public health experts estimate that 2% to 3% of active users develop serious behavioral disorders. The rate is similar to that of online casinos.
The National Council on Problem Gambling (NCPG) released data in its 2025 census. The survey indicated that 52% of event gamblers admitted to trying to recoup losses immediately with new bets. This behavior is a classic indicator of compulsive gambling.
Kalshi has stated that it hopes to reverse the Brazilian government's decision. The company seeks to resume its operations in the country.
