Wall Street calls them prediction markets – Britain calls it gambling

One of the hottest stories in American finance is about two companies that most Brits cannot legally use.

In New York, the numbers read like a venture capitalist’s fever dream. Kalshi, the larger of America’s two big prediction-market platforms, was valued at around $22 billion in March, double its $11 billion mark from December.

Its rival Polymarket, valued at roughly $9 billion last October after a strategic commitment of up to $2 billion from the owner of the New York Stock Exchange, is now reported to be raising at about $15 billion. In March, both were said to be chasing valuations near $20 billion apiece.

The category even has a grand new name in Silicon Valley: information finance, a serious asset class for serious money.

Cross the Atlantic, and the romance evaporates. Neither Kalshi nor Polymarket legally serves customers in the United Kingdom; Polymarket geoblocks British IP addresses outright, and Kalshi lists the UK among its restricted jurisdictions. The reason is not a technicality. It is that Britain looks at these platforms and sees something it already has a very old word for. It sees a bookmaker.

The product and the boom

Strip away the language and a prediction market is simple. Users trade binary, all-or-nothing contracts on the outcome of real-world events, with the price reflecting the implied probability. So a contract trading at 65 cents implies the market thinks there is a 65% chance the answer is yes.

The events range from election results and interest-rate decisions to sports outcomes, economic data and pop-culture trivia. The pitch is that the wisdom of crowds, with money on the line, produces sharper forecasts than any pundit.

The money has poured in. Total trading volume across the sector reached roughly $44 billion in 2025, split between Polymarket at around $21.5 billion and Kalshi at around $17.1 billion, and by January 2026 monthly volume had already passed $21 billion.

HotMinute has tracked the British side of this story closely, including a first-hand attempt to open a Kalshi account from London and an earlier test of Polymarket from the UK. The verdict both times was the same: you can browse, but you cannot trade.

America’s unfinished argument

The American framing turns on a careful piece of positioning. Kalshi, founded in 2018, operates as a CFTC-approved prediction exchange and presents its event contracts as financial products rather than bets, a posture that has helped it capture roughly 90% of the US market.

Calling the contracts derivatives, supervised by the Commodity Futures Trading Commission, is what lets a betting-shaped business raise capital as a fintech.

That argument is far from settled even at home. In the United States, the platforms have claimed their authority falls under the CFTC rather than state gambling regulators, a position that has triggered lawsuits and legislative fights across multiple states.

A bill led by Adam Schiff and John Curtis takes aim at sports trading on the platforms, states such as Utah have tightened gambling laws, and both Kalshi and Polymarket have rolled out anti-insider-trading rules for politicians and athletes.

America has not decided whether this is finance or gambling. It has simply allowed the question to stay open while the valuations climb.

Britain’s settled one

The UK has no such ambiguity, and not because it is squeamish about betting. Quite the opposite. Britain has let people wager on elections, the weather and almost anything else through licensed bookmakers and exchanges such as Betfair for decades.

That history is precisely why the “prediction market” rebrand earns no special treatment here: the law already has a box for it.

The Gambling Commission has said that, depending on the business model, current prediction-market products would appear to fall within the definition of a “Betting Intermediary” under UK legislation, viewing them as gambling products that must be licensed like betting exchanges.

Brad Enright, the Commission’s Head of Operations, addressed exactly these platforms, including Kalshi, Polymarket and Robinhood, in response to questions about whether trading on event outcomes counts as gambling.

Operators that serve British customers without the right licence risk criminal sanctions, not just a stern letter. Where America is still arguing about which regulator owns the question, Britain answered it before the question was fashionable.

What it means for British punters

The legal way to trade these markets is through a Gambling Commission-licensed operator: Betfair and Smarkets already run overlapping political and event markets, and Matchbook is building a dedicated UK prediction-markets product.

Reaching the American platforms instead means circumventing their own controls, with no UK consumer protection if a trade goes wrong.

There is a fiscal sting too. Because Britain treats these markets as gambling, winnings placed through a licensed UK operator are tax-free, one of the quieter perks of the gambling classification.

Route money through an offshore platform via a crypto leg, however, and the tax treatment changes, since HMRC can treat the crypto disposal as a capital-gains event. The word “gambling” is not only a restriction.

In this corner, it is also a tax break Britons forfeit the moment they go looking for the higher-octane American version.

Is it a bubble?

The deeper point is how fragile those eye-watering valuations may be. A recent Boston Consulting Group and FT Partners fintech report flags prediction markets as a striking example of valuations racing ahead, while warning that the eventual size, durability and exit potential of these businesses could be shaped as much by how regulation evolves as by product adoption.

Europe is already making that case forcefully. In late May, Spain blocked domestic access to both Kalshi and Polymarket and opened formal proceedings over unlicensed gambling, with regulators on this side of the Atlantic moving faster than their American counterparts.

So a $22 billion company rests, in the end, on a single contested noun. Call it a prediction market and it is the future of finance, courted by the New York Stock Exchange’s owner.

Call it gambling and it is an unlicensed bookmaker that needs a permit and cannot take a penny from a London flat.

America is still choosing the word. Britain, and now Spain, already chose, and the entire valuation hangs on who turns out to be right.

Now read: I tried to use Kalshi from the UK in 2026 – Here’s what worked and what didn’t