Malta drafts prediction market rules as potential third regulatory category
Malta is drafting a bespoke regulatory framework that would classify prediction markets as a third category separate from gambling and finance. The effort mirrors the Mediterranean island's 2018 cryptocurrency strategy of attracting operators with tailored oversight rather than aligning with traditional regimes. Industry observers say Brussels may ultimately set the final rules. The move comes as Blockchain.com and Jump Trading expand their prediction market presence, and Robinhood already offers event contracts through its partnership with Kalshi.
A bespoke Maltese framework would give prediction market operators a regulatory address outside both gambling commissions and financial regulators. For Blockchain.com and Jump Trading, that opens a permissive EU base for European expansion at the exact moment ESMA has declared event contracts fall under its retail binary options ban.
Malta's 2018 crypto playbook succeeded in attracting firms before Brussels overrode parts of it; operators now face the same calculated risk of building on sand. The wider stakes sit in Brussels: if the European Commission harmonizes the space, Malta's carve-out collapses. Platforms betting on the island's autonomy need a Brussels contingency or risk second relocation.