Executive Summary

Prediction markets — financial platforms where participants purchase and trade contracts whose value is determined by the outcome of a future event including sporting events or lottery draws— are expanding rapidly. In the United States, the Commodity Futures Trading Commission (CFTC) has authorized event contracts on sporting outcomes under commodity law. Similar products are under active regulatory assessment in the United Kingdom, Australia, France, and Canada.

These products perform the same economic function as licensed sports betting: a financial instrument whose value is determined by the outcome of a sporting competition, for which operators require a local gaming licence. Yet they operate without the consumer protections, anti-money laundering (AML) obligations, age verification requirements, or sports integrity safeguards that licensed sports betting operators are legally required to meet. The same logic applies to the prediction of results from lottery draws or casino games.

The World Lottery Association (WLA) — whose 160-plus member organizations span 80 jurisdictions and collectively returned USD 95 billion to public good causes in 2024 — has published a comprehensive Position Paper setting out its analysis and policy recommendations.

The WLA calls for the urgent alignment between gambling and financial regulators to close regulatory gaps and ensure prediction markets are subject to the same licensing, integrity, and consumer protection standards as betting.

Thus, the WLA calls on gambling regulators, financial regulators, AML authorities, and sports integrity bodies in all relevant jurisdictions to:

1. Assess whether prediction market event contracts, in particular on sporting outcomes, fall within existing gambling or sports wagering regulatory frameworks under their jurisdiction,
2. Where they do, apply equivalent consumer protection, AML, and responsible gambling obligations to those applicable to licensed sports betting operators.
3. Where existing frameworks do not apply, consider whether amendment or supplementary regulation is warranted to close the identified gaps, taking into account existing exclusive rights and licensing regimes.
4. Integrate prediction market operators offering sports event contracts into existing sports integrity monitoring frameworks, including Macolin Convention national platforms and operator-to-integrity-body alert systems.
5. Assess whether prediction market event contracts on lottery-based results fall within gambling regulatory frameworks under their jurisdiction.
6. Where they do, apply equivalent consumer protection, AML, and responsible gambling
   obligations to those applicable to licensed lottery operators.

The World Lottery Association is the international body representing state-authorized lottery and sports betting operators. Its 160-plus member organizations span 80 jurisdictions and include some of the world's largest public-benefit operators. In 2024, WLA member organizations collectively returned USD 95 billion to governments, public health, sport, culture, and education. The WLA's full position paper on prediction markets is available at wla.one.