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PREDICTION MARKETS

Are prediction markets legal? A neutral guide to how the rules vary

There is no single answer: the same Yes share can be a regulated financial contract in one country and an unlicensed bet in the next. Here is how to think about it, with dated examples and no legal advice.

By CopyHype · Updated · 5 min read

Short answer

Whether prediction markets are legal depends on where you live, and this page is not legal advice. Some countries treat them as financial contracts, some as gambling that needs a license, and some have no clear rule. For example, Kalshi says it is regulated in the US by the CFTC as a Designated Contract Market, while France's gaming regulator banned transactions with Polymarket in November 2024 and announced a block of its website on July 17, 2026. Platforms also restrict some countries in their own terms. Check your national rules before using real money.

"Is this legal?" is the right question to ask before any real money prediction. It is also one where a confident one-line answer would be wrong. This page explains why the answer varies, gives dated examples from two countries, and lists what to check where you live. It does not tell you what is allowed for you. For that, ask your local regulator or a lawyer.

It depends on the country, and sometimes on the region inside it. The same contract can be a regulated financial product in one place, a licensed bet in another, and banned in a third.

A prediction market share pays $1 if an event happens. Some regulators look at that and see a financial derivative, like an option. Others see a bet on an outcome, like a sportsbook. Many see both, depending on the event: a share on an interest rate decision may be treated differently from a share on a football match. This page is not legal advice.

Because prediction markets sit between two rulebooks: gambling law and financial law. Each country decides which one applies, and some have not decided.

How a country may see it What usually follows
A financial contract A financial regulator, licensed exchanges, investor rules
A bet A gaming regulator, licensed operators, betting rules
Neither, yet No clear rule, which is not the same as allowed
Both, by market Sports may follow betting rules while other events follow financial rules

Crypto adds a layer. A market run on a blockchain can be reachable from everywhere, while the law where you live still applies to you. "I could open the site" does not mean "it is allowed here."

How does the United States treat them?

At the federal level, Kalshi says it is regulated by the CFTC as a Designated Contract Market. Crypto platforms have handled US users differently.

Kalshi's help center states that it "is regulated by the Commodity Futures Trading Commission (CFTC), an independent agency of the US government" and "is regulated as a Designated Contract Market (DCM)" (>Kalshi help center). A May 2026 comparison by Chainstack reported that US traders are geo-blocked from Hyperliquid's HIP-4 markets and from Polymarket's international platform (>Chainstack). Questions between federal and state rules, especially on sports, have been the subject of disputes, so check the current situation where you live.

How does France treat them?

France's gaming regulator, the ANJ, treats Polymarket as an unauthorised betting site. It banned financial transactions with it in November 2024 and announced a block of the website on July 17, 2026.

According to an AFP report, the ANJ said the site's continued availability with live odds amounted to advertising, and that "advertising, by any means whatsoever, in favour of an unauthorised betting or gambling site is a criminal offence", with fines that can reach 100,000 euros (>eNCA, AFP). The report also said visits from French addresses rose to 578,751 the month before, despite the transaction ban.

What about other countries?

Rules differ widely, and they change. Some countries license online betting and require operators to hold a local license. Some ban online betting outright. Some regulate event contracts as financial products. Some have no specific rule.

We do not list countries one by one, because a list would go out of date fast and look more certain than it is. The reliable source is your national gaming or financial regulator. If prediction markets are not mentioned at all, that is a reason to be careful, not a green light.

A useful test: if your country requires a local license to offer betting, and the platform does not hold one, using it may break local rules even if the site opens for you. Regulators can also act on payments rather than on the site itself, as France did first with Polymarket.

What do the platforms' own terms say?

Platforms restrict some countries themselves, whatever local law says, and their terms usually forbid getting around a block. Read them before you sign up.

A June 2026 summary of Hyperliquid's terms of use by Datawallet says they restrict users in the United States and Ontario, and that using a VPN to get around geoblocking breaks the terms (>Datawallet). Polymarket keeps US users off its international platform, per Chainstack's comparison. Breaking a platform's terms can mean a frozen account, on top of any legal risk.

Do you pay tax on prediction market winnings?

Often, yes, but how depends on your country and on how it classifies the contract. Gambling winnings, capital gains and income can all be taxed differently.

Keep a record of every trade: date, market, amount in, amount out. If your country treats prediction market profits as capital gains, losses may count too; if it treats them as gambling, the rules may be different. Ask a tax adviser where you live. This is not tax advice.

How do you check the rules where you live?

Look at your regulator, then the platform's terms, then your tax rules. If anything is unclear, ask a professional before using real money.

  • Your gaming regulator. Does it list licensed operators, and does it mention prediction markets?
  • Your financial regulator. Does it treat event contracts as financial products?
  • The platform's terms. Is your country on its restricted list?
  • Your tax authority. How are winnings taxed?
  • A lawyer. For anything you are not sure about.

What does CopyHype do?

Predictions are live in CopyHype, with free practice money first. Availability of real money predictions may differ by country.

Practice uses practice money: no real money is put in or paid out. Before you use real money on any prediction market, CopyHype's or anyone else's, check that it is allowed where you live. You can lose the amount you put in. How it works: Predictions in CopyHype.

Frequently asked questions

It depends on the country. For example, France's ANJ treats it as an unauthorised betting site, and its international platform keeps US users out, per Chainstack. Check your local rules.

Kalshi says it is regulated in the US by the CFTC as a Designated Contract Market. Whether you can use it depends on where you live.

We cannot answer that for you. Hyperliquid's terms restrict some places, including the United States and Ontario, according to a summary of those terms. Check the terms and your local law.

Can I use a VPN to access a prediction market?

Platforms' terms usually forbid it, and it does not change the law where you live. It can also get your account frozen.

Are prediction market winnings taxed?

Often, yes, but the rules depend on your country. Keep records and ask a tax adviser.

Where do these facts come from?

From Kalshi's help center, an AFP report on France, a developer comparison and a summary of Hyperliquid's terms, all dated. Sources:

This page is general information, not legal or tax advice. Rules change; we checked these facts on October 18, 2026.