EU Regulator Targets Polymarket and Kalshi
The European Securities and Markets Authority (ESMA) has issued a stark warning regarding the rapid expansion of prediction markets, claiming the sector is "rife with inside trading." According to Decrypt, the EU regulator specifically called out leading platforms Kalshi and Polymarket, questioning their inconsistent geoblocking of EU countries and noting that users are easily circumventing these restrictions using VPNs.
This scrutiny comes as part of a broader regulatory push. ESMA recently flagged prediction markets, alongside DeFi exploits and tokenized equities, as areas where growing crypto ties could amplify risks to the broader traditional financial system.
Institutional Access Expands Ahead of US Midterms
Despite regulatory headwinds in Europe, institutional infrastructure for prediction markets continues to mature in the United States. Ahead of the upcoming US midterms, data provider DoubleZero has integrated Kalshi's election market data. This expansion grants automated and institutional traders real-time access to political betting markets, a crucial development for quantitative traders leveraging resources like predictionmarketstools.com to analyze shifting political odds at scale.
Markets Price In 64% Odds of Fed Rate Hike
Meanwhile, prediction markets are actively pricing in shifting macroeconomic realities. Following August producer prices coming in at 0.4% and inflation holding at 3.4%, betting odds for a Federal Reserve rate hike next week have surged. As reported by The Defiant, hike odds reached 64% as Brent crude topped $106 and Bitcoin traded at $77,120. This aligns with shifting institutional sentiment, as Goldman Sachs became the final major bank to retract its forecast of no rate hike late Friday.