Spain’s gambling regulator has ordered the precautionary blocking of Kalshi and Polymarket and opened formal disciplinary proceedings against both platforms for operating without a licence.
The Directorate General for Gambling Regulation (DGOJ), operating under the Ministry of Social Rights, Consumer Affairs and Agenda 2030, published the sanctioning notices in the Official State Gazette (Boletín Oficial del Estado) on Tuesday. Both New York-based platforms are accused of offering services in Spain without the mandatory administrative authorisation required under the country’s gambling regulations. The precautionary block will remain in force until the proceedings are resolved, a process the ministry estimates will take three to four months.
Regulator cites consumer protection failures
The DGOJ identified specific consumer-protection deficiencies on both platforms as grounds for the action. These include the absence of effective identity-verification systems, no controls to restrict access by minors, and no mechanisms to block self-excluded or gambling-prohibited individuals from accessing the services.
The government confirmed that attempts to notify the two companies at known foreign addresses before the formal proceedings were initiated were unsuccessful.
Spain, in line with other European jurisdictions, considers prediction markets to be gambling when bets are placed on uncertain future outcomes. Therefore, operating them in Spain requires a specific administrative licence. Furthermore, the DGOJ warns that unauthorised operators lack the technical and regulatory safeguards required in Spain, including identity verification systems, mechanisms to control access by minors and individuals who have self-excluded or are prohibited from gambling and the necessary supervisory standards to protect users.
Following the close of proceedings, the two platforms face three paths: seek proper licensing in Spain, mount a legal challenge to their classification as gambling products, or adjust their offerings to comply with local rules.
Licensed operators already hold the market
Spain’s gambling market is well-developed. The DGOJ lists 54 companies holding sports betting licences, with major international operators including Entain, Evoke, bet365, Betsson, Flutter Entertainment and Betway all holding active authorisations in the country.
Flutter’s Betfair Exchange is the closest structural equivalent to Kalshi and Polymarket currently operating in Spain under full regulatory approval. CIRSA, which runs the Sportium brand, has also signalled plans to launch its own prediction markets product. CIRSA CEO Antonio Hostench stated earlier this year that his company was “200% protected” against US-based platforms precisely because of Spain’s regulatory framework — a position the DGOJ’s action now formally reinforces.
A widening European enforcement picture
Spain joins a growing list of European regulators taking formal action against prediction markets. The Netherlands Gambling Authority (KSA) issued a cease-and-desist order against Polymarket earlier this year for operating in the country without a licence. By contrast, Denmark’s gambling regulator has acknowledged it currently lacks the legal tools to block platforms without evidence of Danish-specific targeting, underscoring the uneven enforcement picture across Europe.
Both Kalshi and Polymarket are federally regulated in the US by the Commodity Futures Trading Commission, which classifies their products as financial instruments rather than bets. That distinction carries no weight under European gambling frameworks, where the economic structure of event contracts — placing stakes on uncertain future outcomes — determines classification.
The Spanish action is among the most formal enforcement steps taken against either platform on the continent, given the publication of proceedings in the official state gazette and the explicit resolution timeline. Kalshi has faced comparable regulatory challenges in the US, including a lawsuit from the Massachusetts Attorney General over alleged illegal sports betting operations.
Both companies continue to operate at significant scale. Kalshi reached a $22bn valuation after a $1bn Series F funding round closed earlier this month. Polymarket, which counts Intercontinental Exchange among its strategic investors, is reported to be in talks at a $15bn valuation and recently relaunched services in the US market.
The outcome of Spain’s proceedings will be watched closely across Europe. A formal ruling that prediction markets constitute gambling under Spanish law — and the licensing path or exclusion that follows — is likely to inform the approaches of regulators in markets that have not yet acted.
Source: DGOJ / Ministry of Social Rights, Consumer Affairs and Agenda 2030
