PREDICTION MARKETS
financial resources having regard to the nature, scale and complexity of the business 9 . In practice, the question most often raised since publication of the Regulations is whether existing Gibraltar B2C licensees will be automatically grandfathered into the new regulatory framework. They will not. Existing Gibraltar gambling licensees enjoy no automatic passport: holding a Part 4 license does not, of itself, authorize prediction market activity, and a separate authorization is required. New entrants whose business is purely prediction markets, by contrast, can seek authorization without holding a general gambling license at all. In short, this is a distinct process and authorization, and applicants should expect the same intensity of scrutiny associated with Gibraltar's established licensing process. Vetting the product The feature that most clearly distinguishes this system from traditional gambling regulation is that the product itself is vetted. Under Part 3, an authorized operator may not list or make available a prediction market contract unless it has been approved by the Authority, or certified under arrangements the Licensing Authority has approved, and unless the operator is reasonably satisfied that the contract is clear, capable of objective settlement, not readily susceptible to manipulation and consistent with the regulatory objectives 10 . The Authorised Operators’ Contract rules must make provision for: (a) the specification of each prediction market contract; (b) participant eligibility; (c) trading, matching and order handling; (d) suspension, cancellation, voiding and delisting; (e) error trades and market disruption; (f) objective settlement sources; (g) procedures for disputes relating to settlement; and (h) records, reporting and audit trails, including the reporting of transactions to the Licensing Authority. Furthermore, the Licensing Authority retains the power to require an operator to suspend, amend, void, withdraw o r
delist a contract. This follows the close regulation of gambling operators in terms of the gambling offerings and critical suppliers. It seems that contract approval is likely to prove one of the most significant practical differentiators between Gibraltar and other jurisdictions. Many operators have developed products in environments where the key regulatory question has been whether a product falls inside or outside an existing regulatory framework. Gibraltar instead asks whether a particular contract should be capable of being offered at all and, if so, upon what terms. Supporting this is a detailed section in the Regulations for contract rules. An operator must maintain contract rules approved by the Licensing Authority making provision for the specification of each contract, participant eligibility, trading and order handling, suspension and voiding, error trades and market disruption, objective settlement sources, settlement dispute procedures, records and audit trails including regular transaction reporting to the Licensing Authority 11 . For example, a settlement source must be reliable, transparent, verifiable and, so far as reasonably practicable, resistant to manipulation 12 . This is a direct effort to regulate the source that determines who wins. The prediction markets framework also expressly lists what may not be traded. The Licensing Authority may by direction prohibit or restrict a whole class of contract where it would be contrary to the regulatory objectives or the public interest of Gibraltar, and in doing so may have regard to whether a contract relates to criminal conduct, death, serious injury or terrorism, the occurrence of war or armed conflict, an event incapable of objective settlement, or any matter giving rise to significant manipulation, disorderly trading, consumer harm or reputational risk to Gibraltar 13 . This content-based scrutiny and restriction has no natural equivalent in a Gibraltar gambling license.
9 Prediction Market Regulations 2026, reg 20(1) 10 Prediction Market Regulations 2026, reg 12(1), reg 12(2) and reg 12(4) 11 Prediction Market Regulations 2026, reg 13(1) and reg 13(2)
12 Prediction Market Regulations 2026, reg 13(3) 13 Prediction Market Regulations 2026, reg 14
IMGL MAGAZINE | SEPTEMBER 2026
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