Gibraltar Licenses First Prediction Market Operator and Signals Bespoke Regulatory Path for Europe

Prediction markets keep hitting regulatory walls across Europe. Spain’s DGOJ became the eleventh regulator to suspend these platforms last week. It gave Kalshi a four month window to explain how its service differs from online betting.

Yet Andrew Lyman, Gambling Commissioner for Gibraltar, is taking a different approach. Gibraltar has already licensed ADI Predictstreet as its first prediction market incumbent. The jurisdiction is now exploring a tailored regime that brings AML and SR obligations while allowing selective authorisations.

This stands in contrast to blocking orders from France, Portugal, Romania and Ukraine. The move matters for operators and tech partners watching how prediction markets might scale beyond the US.

Gibraltar’s Agile Regulatory Mindset

Andrew Lyman confirmed the licensing of ADI Predictstreet in conversation with SBC News. The platform currently operates under the existing gambling regime as an intermediary. But Nigel Feetham KC MP, the responsible minister, has publicly backed development of a bespoke model for prediction markets.

Lyman explained the jurisdiction’s philosophy. “As a small jurisdiction we are agile and whilst the mindset of some jurisdictions is ‘how can we stop this’, our mindset is ‘how can we regulate to jurisdictional advantage whilst guarding reputation.”

That agility comes from Gibraltar’s ongoing overhaul of its Gambling Act. New provisions are scheduled for implementation in 2026. Unlike many peers, Gibraltar does not tie itself to analogue definitions of remote gambling that it has regulated since 2004.

The new framework will cover all services and utilities related to iGaming as a high risk sector. This lets regulators assess prediction markets on their merits rather than forcing them into existing boxes.

From the supplier side this kind of regulatory clarity is what speeds up commercial integration. After eighteen years across iGaming and sportsbook operations I have seen how ambiguity stalls partnerships and product rollouts.

Balancing Consumer Demand with Integrity Controls

Andrew Lyman sees clear demand. “Prediction markets are meeting consumer and market demand. Prediction markets can be regulated proportionately from an integrity, AML and consumer protection point of view. You just need a can-do attitude.”

He argues these platforms extend the betting exchange model. “Prediction markets, matching buyers and sellers, are an extension of the betting exchange model – new, but not completely.”

Licence conditions can limit undesirable markets. Operators must still meet AML and player protection standards. Lyman rejects the idea that this creates unfair advantage over traditional licensees.

“Prediction markets do create competition for existing gambling operators, but may also attract a new cohort of participants,” he said. “Under our regime they have to focus on AML and player protection so there is no regulatory advantage for prediction markets over existing operators.”

Traditional sportsbooks may respond by building their own prediction products or forming partnerships. This possibility sits at the centre of Gibraltar’s thinking as it updates its Gambling Act to expand economic opportunities in the iGaming sector.

Lessons from the 1990s Online Gambling Bet

Andrew Lyman draws a direct parallel to Gibraltar’s early embrace of online gambling in the 1990s. That first-mover stance established the jurisdiction as a reputable licensing home long before most of Europe followed.

“Gibraltar has always had a culture of first-mover advantage,” he said. “Operators of gambling derivative products are looking for a reputable home for licensing purposes and putting up the ‘open for business’ sign puts Gibraltar on the map.”

The economic upside is explicit. Deep-pocketed ventures like Kalshi and Polymarket carry valuations above $20bn. European gambling PLCs sit below that level. Licensing selective operators could capture part of that momentum.

ADI Predictstreet itself has faced scrutiny. Its FIFA World Cup 2026 partnership and a recent tie-up with Fanatics Markets for an interactive hub have drawn attention. Gibraltar still chose to greenlight the business.

Risks, Criticism and the Limits of Selectivity

Prediction markets have drawn heavy criticism in the US and confusion in Europe. Some states have pursued legal action against Kalshi and Polymarket. In Europe ADI Predictstreet found itself at the centre of an investigative piece after becoming FIFA’s official prediction markets partner for the 2026 World Cup.

Gibraltar’s selective licensing carries obvious risks. A single high-profile failure could damage the jurisdiction’s reputation. Lyman acknowledges this by stressing continued selectivity about who and what receives a licence.

The sandbox approach he describes aims to test business models under supervision. “We are happy to work in a sandbox with prediction markets operators under a licence to ensure the business model works from both a commercial and regulatory perspective.”

Yet selectivity itself creates a new challenge. If only a handful of operators gain approval the market may not reach the scale needed to prove the model’s broader viability. Consumer protection standards must remain consistent or the entire experiment risks being painted as light-touch.

These limitations matter for any operator or supplier considering Gibraltar as an entry point. The first-mover advantage only holds if the regime demonstrates it can scale safely.

The Bottom Line

Gibraltar is betting that proportionate regulation beats prohibition. By licensing ADI Predictstreet and preparing a bespoke framework it positions itself as the European jurisdiction willing to engage with prediction markets on their own terms. For SCCG client-partners this creates a concrete test case to watch through the 2026 Gambling Act changes and the World Cup cycle. The real proof will come in how cleanly the licensed operators meet AML, integrity and consumer protection obligations while attracting new participants. If it works Gibraltar could reshape how the rest of Europe eventually adapts.