Crypto prediction markets are at a global regulatory crossroads. On one side of the Atlantic, the United States is witnessing the emergence of the first regulated prediction market with BitMart US; on the other, the European Union under the auspices of ESMA threatens to ban these same products for retail investors. A regulatory divergence that draws a two-speed geography of prediction trading.
BitMart Launches the First Regulated Prediction Market in the US
BitMart US has obtained regulatory clearance to launch a prediction market compliant with SEC requirements. This is a first in the United States, where prediction markets have long been a regulatory blind spot. The platform offers contracts on political, economic, and sporting events, with strict compliance with federal securities laws.
“We have worked hand in hand with regulators to create a framework that protects investors while allowing innovation,” said the CEO of BitMart US. “Prediction markets are not gambling — they are hedging and price discovery tools that deserve a clear regulatory framework.”
Europe Shuts the Door
Against the current, ESMA (European Securities and Markets Authority) has issued a severe warning: many prediction market contracts are already subject to the retail ban in the EU under MiCA regulation and derivatives rules. ESMA considers that event-based CFDs (Contracts for Difference) — which form the bulk of prediction products — cannot be offered to retail investors due to their complexity and implicit leverage.
This position places the EU in direct contradiction with the American approach: where the US creates a framework to govern innovation, Europe chooses restriction.
Polymarket Dominates Despite Geo-Blocking
Ironically, Polymarket — the leading prediction platform — remains flooded with US bettors despite its official geo-blocking. Users circumvent restrictions via VPN, and the volume of US political markets on Polymarket exceeds that of all European platforms combined. Bets on the November 2026 midterm elections already account for 47% of the platform’s total volume.
This situation creates a paradox: American investors are massively using a product that US regulators have not yet regulated, while Europeans are being banned from a product that the US is beginning to regularize.
What Impact for the Crypto Market?
The US/EU divergence on prediction markets could have profound consequences:
- US Competitive Advantage: US-based platforms attract talent and capital, while European ones face increasing regulatory constraints
- Regulatory Innovation: The BitMart US framework could become a model for other jurisdictions — the UK, Singapore, and the UAE are watching closely
- Impact on Liquidity: Over time, prediction market liquidity could concentrate in the US, reducing European investors’ access to these hedging tools
Key Takeaways
Crypto prediction markets are at a pivotal moment. The United States is choosing regulation and innovation, while Europe opts for restriction. BitMart US has crossed the regulatory Rubicon, and ESMA is trying to shut the door on the other side of the Atlantic. The coming months will be decisive in determining which model — regulated integration or restriction — becomes the global norm.
DailyCryptoNews provides information, analysis, and educational content. No published content constitutes investment advice, financial recommendation, or solicitation to buy or sell any asset.
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