The Gibraltar Gazette officially published a 24-page regulatory document on Monday, marking the first global independent regulatory category for prediction markets, with its own authorization and operational requirements. This regulation, led by Minister of Justice, Trade and Industry Nigel Fittem, is part of the "Gibraltar Gambling Act 2025." It was first signaled during the April parliamentary inquiry, and after licenses were issued to ADI Predictstreet and WagerWire in June and July, the official regulatory text finally completed the last link. The PASA official website noted that Fittem announced a significant positioning statement - "the world's first such specialized framework" - at a time when ESMA had just reaffirmed that binary outcome contracts fall under financial derivatives regulation, and eight European gambling regulators had just started a joint crackdown, Gibraltar chose a completely opposite path.
Risk-tiered regulation: From event contract approval to market manipulation to prohibited contract list
This framework's underlying logic is not simply "prediction markets fall under gambling regulation," but adopts a "risk and activity-based" tiered path. All event contracts must be approved and certified by the Gibraltar Gambling Authority, and must be "clear, capable of objective settlement, not susceptible to manipulation, and consistent with regulatory objectives." Operators are required to build internal systems to prevent market manipulation, insider trading, and misuse of confidential information.
The Gambling Authority retains the discretion to restrict or prohibit specific contracts—contracts involving criminal offenses, death, serious injury, terrorism, war, or armed conflict are strictly prohibited. This prohibited list directly addresses the global gambling regulators' core concerns about prediction markets: some event-based contracts, once opened for trading, are not only ethically unacceptable but could also open up significant enforcement loopholes in market integrity and financial crime.
The framework also establishes an independent oversight group responsible for supervising the implementation process. Fittem told iGB that the agency has extensive experience in regulating technology-driven markets and complex digital environments. He also revealed that the regulatory bodies and departments have received strong interest from a large number of potential applicants, including "some globally renowned companies."
From "betting intermediaries" to a specialized category, two licenses have already been issued
ADI Predictstreet's license was initially issued under the old law as a "betting intermediary" category—because the "Gibraltar Gambling Act 2025" had not yet fully taken effect. The new regulations officially establish prediction market activities as an independent legal category, with their own authorization, operational requirements, and regulatory framework. WagerWire was granted principle approval in June and will become the second licensed entity in Gibraltar. Travis Gage, co-founder of this California-based startup, told iGB that the platform aims to launch B2B and B2C prediction market products during the NFL preseason in August and the international football season opening window.
Gage's assessment of the Gibraltar framework is quite straightforward and historically conscious: "I think this is the end of the Wild West era and the taming of the frontier. What Gibraltar is doing—they say, 'We are the first to introduce new traffic rules,' and they have a history of becoming the gold standard. I believe their framework will be adopted by countries with or without their own gambling regulators, just as their gambling licenses have been widely adopted for over a century."
European division intensifies: Eight countries are sealing, one peninsula is collecting
In announcing the framework's implementation, Fittem candidly admitted that there is still "no unified consensus" globally on how to classify prediction markets. U.S. financial and gambling regulators have been entangled for a long time over the regulatory ownership of this category—explosive growth in leading platforms like Kalshi and Polymarket has made this multiple-choice question increasingly urgent. Just last week, the EU financial regulator ESMA reaffirmed its stance on binary outcome fixed payout contracts as financial derivatives. On the gambling regulation front, regulators from Belgium, France, Germany, Italy, the Netherlands, Poland, Portugal, and Spain launched a joint enforcement in June targeting this category, pointing out its lack of betting limits, cooling-off periods, and other basic player protection mechanisms.
Fittem attempts to position Gibraltar's framework as a third path. He emphasized that the system has incorporated safeguards reflecting the characteristics of exchange-type market operations—covering prevention of market manipulation, conflict of interest management, participant protection, corporate governance, customer asset segregation, anti-money laundering and compliance with sanctions, as well as financial resources and orderly exit planning. From a textual structure perspective, Gibraltar's framework tries to carve out a middle ground between "prediction markets fall under financial regulation" and "prediction markets are illegal gambling"—recognizing it as a hybrid category that requires independent regulation, neither throwing it into the existing gambling license classification nor pushing it to financial derivatives regulators.
PASA's official website believes that what is most noteworthy about Gibraltar's regulatory experiment is not whether it can attract the next batch of licensees—globally renowned companies are already lining up to apply—but whether in the next 12 to 24 months, platforms like Kalshi and Polymarket, which have been banned by eight European countries, and those hesitating under ESMA's warnings, will start to see Gibraltar's "third path" as a strategic exit from regulatory encirclement. If this door really starts to be knocked on, today's 24-page regulation is not just a new license category for Gibraltar—it will become a cornerstone for the prediction market industry to move from regulatory fragmentation to institutionalization.
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This article is from "PASA-Global iGaming Leaders," a gambling industry news channel: https://t.me/pasa_news
Original in-depth gambling channel: https://t.me/gamblingdeep
Free data reports: @pasa_research
PASA Matrix: @pasa002_bot
PASA official website: https://www.pasa.news
