Brazil Prediction Markets Ban Sparks Legislative Push

The Brazilian government’s aggressive crackdown on non-financial event betting has catalyzed a rapid legislative push in Brasília to establish a formal regulatory framework. In late April 2026, the National Monetary Council (CMN) approved Resolution 5,298/2026, which strictly prohibited the offering and trading of derivative contracts linked to non-financial events, including sports, political elections, and entertainment. Following the directive, the Ministry of Finance and telecommunications regulator Anatel blocked 27 prediction and betting platforms, including global giants Polymarket and Kalshi.

The executive branch framed the ban as a necessary consumer-protection measure to safeguard household savings and curb rising consumer debt. However, the sweeping ban has disrupted major corporate plans. Kalshi had recently partnered with local brokerage XP International to expand into Brazil, while the country's primary stock exchange, B3 (B3SA3), had been actively exploring event-based contracts ahead of the October 2026 presidential election. Under the current CMN rules, only derivatives tied to recognized economic benchmarks—such as inflation, interest rates, and the USD/BRL exchange rate—remain permitted under the supervision of the Securities and Exchange Commission of Brazil (CVM).

In response to the regulatory freeze, federal deputies have introduced three legislative proposals, including PL 2643/2026 and PL 2651/2026, to transition prediction markets from a legal gray area into a formal, multi-billion-dollar asset class. Authored by Deputy Márcio Marinho, PL 2651/2026 proposes a structured, tripartite governance model. Under this framework, platforms focusing on entertainment would be supervised as fixed-odds betting by the Ministry of Finance’s Secretariat of Prizes and Bets (SPA), while contracts structured for hedging or investment would fall under the jurisdiction of the CVM, with the Central Bank monitoring financial flows. If passed, the legislation would mandate local corporate representation, strict anti-money laundering compliance, and ban highly sensitive contract categories, such as those referencing military operations or the death of individuals.