World Lottery Association calls for prediction markets to be regulated as sports betting
The association has warned about risks to sports integrity, consumer protection and fair competition.
Switzerland.- The World Lottery Association (WLA) has published a position paper warning about the rapid expansion of prediction markets and calling for the products to be subject to the same regulatory requirements as sports betting.
In the report, titled Prediction Markets: Unlicensed Betting by Another Name — Threats to Sports Integrity, Consumer Protection, and the Lottery and Betting Sector, the association argues that contracts based on sports and event outcomes share the same fundamental characteristics as betting products and should therefore be regulated accordingly.
The WLA called for closer cooperation between gambling and financial market regulators to close regulatory gaps and ensure that prediction market operators comply with licensing, consumer protection, integrity and public-interest obligations comparable to those imposed on regulated lotteries and betting operators.
Among its recommendations, the association proposed that any product that offers a financial return linked to the outcome of a sporting event should be classified as a bet, regardless of how the operator chooses to label it.
The paper urges regulators to explicitly assess the legal status of prediction market products to avoid inconsistencies in the treatment of functionally equivalent activities. It argues that even where such products are classified as financial instruments, they should still be subject to safeguards equivalent to those applied in the gambling sector.
The WLA highlighted the sector’s significant growth. According to its estimates, global prediction market transaction volumes exceeded US$13bn per month by late 2025 and reached US$26bn in January 2026. The association said more than 90 per cent of activity is linked to sports and other event-based contracts.
The report also raises concerns related to sports integrity. The WLA warned that the absence of monitoring systems, suspicious transaction reporting and restrictions on insider trading could create opportunities for bad actors to profit from manipulated outcomes.
It also warned of shortcomings in consumer protection. Unlike licensed gambling operators, many prediction market platforms are not required to implement age verification measures, self-exclusion tools, spending limits or responsible gambling support mechanisms. Finally, the paper raises concerns about a competitive imbalance, since prediction market platforms are able to compete for the same customers without having to bear the costs of compliance, taxation and contributions to public-interest initiatives, or being subject to those obligations, according to the WLA.
