Kalshi Co-Founder Luana Lopes Lara Vows to Overturn Brazil Ban on Prediction Markets

Luana Lopes Lara, co-founder of Kalshi, has pledged to overturn the ban the prediction markets platform has been hit with in Brazil. A native of Belo Horizonte, Lara believes that Kalshi was banned due to an unfair determination taken by the National Monetary Council (CMN).

On 24 April, the CMN instructed Banco Central do Brasil to prohibit prediction market products after ruling that financial derivatives could not be linked to sporting, political or entertainment outcomes. The council’s intervention was partly aimed at protecting the legal scope of Brazil’s Bets regime, which came into force on 1 January and governs the licensing and taxation of online gambling operators.

This development marks another inflection point in the global debate over how to classify event contracts. For operators and investors watching Latin America, the ban highlights both regulatory friction and the strategic openings that often follow.

Regulatory Misunderstanding or Structural Clash?

Speaking to Folha de S.Paulo, Lara argued that regulators had misunderstood Kalshi’s business model and had grouped the US prediction exchange alongside 27 unrelated platforms offering speculative event contracts.

“We are going to try to explain what we do, because it was more a lack of knowledge than anything else,” Lara noted. “Kalshi doesn’t make money when people lose. That’s a very important difference,” the executive added.

Lara, alongside Kalshi co-founder and Chief Executive Officer Tarek Mansour, stand by the firm’s distinction that its prediction markets offered should be viewed under the oversight of the US Commodity Futures Trading Commission (CFTC). The exchange maintains that users trade contracts tied to the outcome of future events, rather than placing wagers against a bookmaker.

This distinction matters. Kalshi and rivals like Polymarket argue that prediction markets function more like financial derivatives than traditional sports betting. Yet Brazilian authorities have drawn a clear line to safeguard the Bets regime that began on 1 January.

Kalshi’s Brazil Strategy: Dialogue Over Litigation

Lara indicated that the company would seek dialogue with Brazilian authorities rather than pursue immediate legal action. “It will be faster than in the US, where we have been working since 2019,” she said. “We want to work constructively with the government.”

Kalshi representatives believe the ban stemmed from a lack of regulatory familiarity with prediction markets, which should be categorised and interpreted differently from the online gambling provisions set under the Bets Law. For Kalshi, Brazil represents the latest battleground in a wider international debate over the classification of event contracts.

The backdrop of Brazil’s October 2026 election may offer Kalshi its best route to entry. The Bets Law is viewed as a failed experiment by President Lula and the PT government, who have vowed to repeal and replace the law with significantly tighter controls on debt, advertising and licensing.

Bargaining has begun in Congress between political blocs to determine which party or senator will take the initiative to terminate the Bets Law. Change here could create a narrower but clearer pathway for platforms that position themselves outside traditional gambling.

Valuation, Momentum and the US Tailwind

Backed by leading venture capital investors, Kalshi is now valued at approximately $22bn, a figure that rivals the corporate valuations of some of the world’s largest gambling groups. That valuation underscores the seriousness with which capital markets view the prediction space.

Meanwhile, developments in Kalshi’s home market are moving in a more positive direction. Under the second Trump administration, the CFTC has become much more friendly towards prediction than it was under Joe Biden’s presidency.

Yesterday, the regulator published a 247 page set of proposed rules governing the predictions space. These rules, if approved in a final review, will give an official greenlight to the sports event contracts operated by prediction platforms like Kalshi and Polymarket in the US, though hypothetical casino-esque markets will not be allowed.

Platforms will also be required to work with integrity monitoring organizations. This requirement may ease concerns around sports integrity that have lingered in contrast to the regulated betting space.

Risks and Limitations in Emerging Markets

Any operator eyeing Brazil must weigh the counterarguments. The CMN’s April decision was deliberate, aimed at preserving the integrity of the Bets regime and preventing regulatory arbitrage. Policymakers may view prediction markets as too close to gambling to warrant separate treatment, especially with an election approaching.

Political bargaining in Congress could delay meaningful reform well beyond 2026. Even if dialogue advances, tighter controls on debt, advertising and licensing could raise compliance costs for all platforms, including those arguing for a financial-products classification.

As someone who has spent decades observing the evolution of gaming regulation across jurisdictions, I see this as a classic structural shift. The tension between innovation and regulatory caution rarely resolves quickly, particularly when tax revenue, consumer protection and market classification collide.

The Bottom Line

Kalshi’s commitment to constructive engagement in Brazil, paired with favorable US regulatory momentum, positions the company at an interesting crossroads. Success will depend on whether Brazilian authorities come to view prediction markets as distinct from the Bets regime rather than a threat to it.

For gaming executives and investors assessing Latin American entry, the story underscores the need to engage regulators early with clear explanations of business models. Political cycles can accelerate or stall progress, making timing as critical as legal positioning.

The convergence of prediction markets with traditional gaming continues to test 20th-century frameworks. Those who treat regulatory dialogue as a core operational input, rather than an afterthought, will be best placed to navigate the next phase in Brazil and beyond.