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USA
Canada
Australia
UKCanadian Regulators Exclude Sports & Entertainment Prediction Markets From Securities Oversight
Key Highlights
- Canadian securities regulators won’t oversee prediction contracts tied to sports or entertainment events.
- Wealthsimple argues event contracts should be treated consistently regardless of whether they involve sports, economics, or other verifiable outcomes.
- Political prediction markets remain unresolved, while lawmakers continue debating gambling rules and consumer protections.
Canadian regulators have made a clear distinction between sports betting and event contracts, at least for the immediate future.
Regulators Draw A Line Around Event Contracts
On August 27, the Canadian Securities Administrators (CSA) clarified that prediction markets involving sports and entertainment won’t be treated as securities products.
The CSA and Canadian Investment Regulatory Organization (CIRO) contend those contracts don’t fit the types of instruments overseen by investment regulators. As a result, sports and entertainment markets won’t be available through platforms supervised under that framework.
Alberta Gaming, Liquor and Cannabis is reviewing what the guidance could mean for online gambling oversight in the province.
Wealthsimple Pushes for More Prediction Markets
Wealthsimple is one of only two Canadian firms with CIRO approval for event contracts, and it began a partnership with the US-based prediction market exchange Kalshi back in June. Interactive Brokers is the other Canadian firm with CIRO authorization to offer event contracts.
Wealthsimple has challenged the distinction between sports contracts and financial or economic contracts. The firm’s chief legal officer, Blair Wiley, wrote in an August 4 white paper that, “a contract on the outcome of a soccer match and a contract on the level of inflation are, mechanically, the same instrument.”
It also wants regulators to permit more contract types when outcomes can be verified through reliable sources such as government data or accredited news organizations. The Wealthsimple Predict app has significantly fewer markets than Kalshi; users can view unavailable markets, like the Academy Awards and 2028 US election, but cannot trade them.
Political Markets & Consumer Protection Questions Continue
The new guidance doesn’t settle every category of prediction market. Regulators said their assessment of political contracts is ongoing, creating an uncertain regulatory environment for online gambling in Canada.
Liberal MP Karina Gould, chair of the House finance committee, has argued that prediction markets should fall under Canadian gambling rules to provide consumer protections. But there are concerns about insider trading, especially as there are several cases in the US involving allegations of people using privileged information to profit from prediction markets.
Some Canadian financial institutions have already introduced internal policies restricting employees from betting on certain events, adding another layer to the developing regulatory landscape.
