- Brazil blocked access to Polymarket, Kalshi, and up to 28 prediction market platforms.
- Rules ban contracts tied to elections, sports, entertainment, and other real-world events.
- Officials said the crackdown aims to reduce debt and social harm due to online gambling.
Brazil has blocked access to prediction market platforms, including Polymarket and Kalshi as part of a wider crackdown on what officials called illegal betting activity.
Finance Minister Dario Durigan said 27 platforms were blocked, while other reports put the number at 28. The action followed a new federal resolution banning event-based prediction contracts tied to elections, sports, entertainment, and other non-financial outcomes.
As per reports, users in Brazil reported that Polymarket and Kalshi were inaccessible after the order took effect. Durigan said the platforms were operating outside betting laws approved by Congress and were not legally regulated in the country.
Government Targets Debt and Gambling Risks
Brazil framed the move as consumer protection, not only market regulation. Officials said rising household debt and online gambling losses have become a growing concern.
President Luiz Inacio Lula da Silva has previously linked financial stress among families to the rapid spread of digital betting platforms. Durigan said stricter enforcement would continue to reduce what he called the social harm caused by unregulated gambling.
Chief of Staff Miriam Belchior said the measure aims to protect income, prevent financial losses, and reduce exposure to unsafe financial behavior.
New Rules Ban Event Contracts
The Banco Central do Brasil issued a resolution prohibiting derivatives whose value depends on sporting events, virtual gaming, political outcomes, or other real-world events not tied to economic or financial benchmarks.
This directly hits the core model used by prediction markets, where traders buy contracts based on whether an event happens. Markets on elections, sports results, social events, and entertainment outcomes are now banned under the new framework.
However, Brazil left room for some contracts tied to real financial data. Products linked to approved benchmarks may still be allowed if cleared by the securities regulator CVM.
Related: Coinbase Moves New York AG Lawsuit to Federal Court Over Prediction Markets
Local Markets Still Exploring Expansion
The decision came as Brazil’s exchange operator B3 was expanding derivatives products. B3 has confirmed six new contracts launching on April 27 linked to the Ibovespa stock index, the Brazilian real, and Bitcoin.
The exchange had also explored event-based markets, including election-linked products. However, the path is now blocked. The new resolution specifically bans contracts tied to political or electoral outcomes.
This matters ahead of Brazil’s October presidential election, where early polling showed President Lula and Senator Flavio Bolsonaro in a close race.
It is important to note that Brazil joins a growing list of countries taking action against prediction markets. Polymarket has already faced restrictions or bans in countries including France, Portugal, Belgium, Italy, Singapore, Australia, and the UK.
Related: New York Governor Signs Executive Order to Ban State Employees from Prediction Markets
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