The UK Financial Conduct Authority (FCA) is holding talks with trading platforms about the possible relaxation of its ban on financial prediction markets for retail investors, according to The Times.
The restriction imposed by the FCA has been in force since 2019. It classifies contracts linked to financial and weather events as binary options, whose sale to the general public was banned for being considered excessively speculative and potentially harmful to consumers.
The FCA’s review comes in response to the millions of British citizens accessing foreign platforms such as Kalshi and Polymarket, global leaders in the sector. Some users bypass geographic restrictions through virtual private networks (VPNs), falling outside the UK’s regulatory protection framework. The industry has long been pressing authorities with concrete evidence about the scale of that outflow to overseas platforms.
The volume of these markets shows enormous growth: firm Bernstein projects that total trading volume in prediction markets will climb from $51 billion in 2025 to $240 billion this year.
Kalshi and Polymarket are valued at $22 billion and $21 billion respectively, while Coinbase, Robinhood and DraftKings have also launched similar products.
Any platform seeking to operate in the UK will need to clear two regulatory hurdles:Â FCA approval for financial contracts and a license from the Gambling Commission for sports and political markets.
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