Canadian Financial Regulators Say They Won’t Allow Sports Prediction Markets

^{Don’t expect sports prediction markets to take Canada by storm the way they have in the U.S. (Image: GK Images/Alamy)}

Canada’s top financial regulators issued a joint notice on Thursday making clear that sports and entertainment prediction markets should not be allowed under the securities and derivatives laws that govern financial trading.

The Canadian Securities Administrators and the Canadian Investment Regulatory Organization published the notice to spell out their position on sports event contracts, citing "growing interest in prediction markets in Canada."

Event contracts pay out based on the outcome of a future event, in this case the outcome of a game or match, and function much like the contracts that fuelled the rapid U.S. growth of platforms such as Kalshi and Polymarket.

"CSA staff’s view is that Event Contracts based on sports and entertainment events or outcomes should not be regulated within securities and derivatives legislation."

The regulators added that while some yes-no event contracts may technically fit the federal definition of a security or derivative, "certain instruments are outside the scope of that framework, or are otherwise excluded, depending on the facts and circumstances."

They are also reviewing whether other categories of event contracts, beyond sports and entertainment, should be excluded from the securities framework.

Sports Betting Belongs to the Provinces, Industry Group Says

The Canadian Gaming Association welcomed the clarification, saying it draws a sensible line between financial products and gambling products.

"The Canadian Gaming Association welcomes today's guidance from CSA and CIRO staff. It brings clarity to a question that matters a great deal to Canadian consumers, provincial governments, and the licensed gaming industry: sports wagering is sports betting, whatever the platform, and it belongs within the framework that provinces have built specifically to regulate it," said Paul Burns, president and CEO of the Canadian Gaming Association. 

Burns said the CGA has "long held that sports wagering, in whatever form it takes, should be offered only through provincial gaming regulators, and that the framework governing a product should be determined by what it does, not by what it is called."

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The CGA also pointed to know-your-customer checks, anti-money laundering controls and integrity monitoring built up over years by provincial regulators, arguing those safeguards "do not appear automatically simply because a product is labelled a ‘contract’ rather than a ‘bet.’"

The distinction matters because the Criminal Code of Canada gives provinces the exclusive right to regulate gambling, including sports betting.

Ontario and Alberta have opened their markets to licensed private-sector operators, while other provinces rely on their own government-run platforms as the only legal option.

Quebec Says Don’t Even Try

Loto-Québec used the notice as an opportunity to remind players that lotoquebec.com is the only fully regulated casino and sports betting site in the province, regardless of the platform, according to its Aug. 27 press release.

The Crown corporation said prediction markets offering sports and entertainment event contracts are not legal in Quebec, and it cited concerns about the integrity of results on unregulated platforms.

What the Rules Actually Allow

Only two CIRO-authorized investment firms, identified elsewhere as Wealthsimple and Interactive Brokers Canada, can currently give Canadians access to event contracts at all, according to CIRO’s own March 26 bulletin on the subject.

Even those two are limited to a narrow set of categories: economic indicators such as inflation and interest rates, environmental indicators such as global temperature, and financial benchmarks such as S&P 500 futures.
Contracts must run 30 days or longer, and elections, political events and sports or entertainment outcomes are explicitly off-limits, per the same bulletin.

Wealthsimple launched a standalone app, Wealthsimple Predict, built on U.S. platform Kalshi’s infrastructure, giving Canadians access to thousands of Kalshi’s permitted event contracts within those same limits.

Regulators Have Warned Before

Thursday’s notice is not the first time the CSA and CIRO have addressed prediction markets.

In an April 2 statement, the regulators reminded the industry that no prediction market has been recognized as an exchange or registered as a dealer by the CSA, and warned that non-compliance "may lead to enforcement action."

Ontario’s securities regulator has already followed through on that warning.

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The Ontario Securities Commission reached a settlement with the current and former operators of Polymarket in 2025 after they admitted to offering short-term binary options to Ontario investors between June 2020 and May 2023, in breach of the province’s binary options ban.

Polymarket’s operators accepted a two-year ban from trading securities or derivatives in Ontario, a $200,000 administrative penalty, a US$22,966.75 voluntary payment and a further $25,000 toward the cost of the investigation.

One Firm Wants the Rules Loosened

Wealthsimple itself has pushed back on parts of the current framework.

In an Aug. 4 white paper, the company argued the 30-day minimum term for event contracts should be lifted and said folding sports-outcome contracts into gambling law, as some have suggested, would be "unworkable."

The company said it favours keeping bilateral sports betting, where an operator sets the odds and takes the other side of the bet, under gaming law, while contracts "traded and cleared by regulated derivatives market intermediaries" stay under securities law.

Thursday’s notice suggests regulators are not moving in that direction for sports and entertainment contracts, at least for now.

Polymarket Already Pulling Back

The practical upshot for Canadian bettors is unchanged. Sports wagers still belong on provincially licensed platforms, such as those operating through iGaming Ontario and the Alcohol and Gaming Commission of Ontario, or the Alberta Gaming, Liquor and Cannabis Commission, inside Canada's regulated online casino and sports betting market.

The CSA and CIRO said their review of other event-contract categories continues, meaning further guidance, and possibly further restrictions, could still follow.

Polymarket has already pulled back from parts of Canada once before, restricting access in Alberta, British Columbia and Quebec last July, a week ahead of Alberta's regulated iGaming launch, on top of the two-year Ontario ban tied to the OSC settlement. Thursday's notice gives that earlier retreat a clearer regulatory backdrop.