Britain’s Financial Conduct Authority is holding discussions with prediction-market platforms including Kalshi and Polymarket as both companies assess opportunities to enter the UK.
Simon Walls, the FCA’s executive director for markets, confirmed the discussions at the regulator’s annual public meeting on 6th October.
“We are engaging,” he said. “We are interested in their plans for the UK.”
Prediction-market platforms allow customers to trade contracts linked to the outcome of financial, political, sporting and entertainment events. Their rapid expansion in the US has placed them in increasingly direct competition with licensed sportsbooks, while opening a wider dispute over whether event contracts constitute financial trading or gambling.
Kalshi has established a British subsidiary, while Polymarket has approached UK lobbyists, according to the Dow Jones-owned publication Financial News. Neither company currently holds the regulatory approvals required to offer its platform to British consumers.
Entry under FCA rules faces an immediate obstacle. The regulator regards the financial prediction-market contracts it has examined as binary options. Since April 2019, binary options have been prohibited from being sold, marketed or distributed to individual customers in Britain.
Christopher Woolard, then the FCA’s executive director of strategy and competition, described binary options as “gambling products dressed up as financial instruments” when the prohibition was announced.
The newer generation of prediction markets has forced regulators to examine whether every event contract belongs within the same category. The FCA’s March 2026 perimeter report said contracts concerning financial or certain climatic events fall within its remit. Its current position is that the financial prediction-market products it has examined are binary options and therefore remain prohibited for retail customers.
Contracts linked to non-financial outcomes, including sport and politics, fall under the Gambling Commission. The Commission said in February that current prediction-market models would probably be classified as betting intermediaries and treated in a similar way to established betting exchanges.
Brad Enright, the Commission’s director of strategy, said operators launching in Great Britain would not be able to classify their products as non-gambling. Unlicensed platforms must ensure they are not targeting or transacting with British consumers.
The regulatory distinction removes one of the principal advantages enjoyed by prediction markets in the US, where federal commodities oversight has enabled some operators to offer sports contracts beyond state-regulated betting markets. Britain already permits sports betting and has licensed betting exchanges for more than 25 years.
The FCA is reviewing its treatment of prediction markets and is expected to publish an engagement paper before the end of 2026. Walls identified low liquidity and possible market manipulation among the risks requiring scrutiny.
No regulatory change or platform approval has been announced. Kalshi, Polymarket and other prospective entrants would still need to satisfy the authorities that their products fall within the appropriate regime before serving British customers.
Tags: Predication Markets, Financial Conduct Authority, UK, Kalshi, Polymarket, Sports Betting
