Canadian Lottery Operators Call for Restrictions on Prediction Market Event Contracts
TL;DR — Canadian Lottery Coalition operators argue prediction markets resemble sports betting and have already reduced regulated gambling revenue, urging action before further expansion. CIRO and CSA stated sports-tied event contracts should not be regulated as securities, mirroring U.S. positions. Platforms like Kalshi and Polymarket continue to draw billions in trades, including from under-18 users.
SCCG Take — Prediction markets’ revenue impact on Canadian lotteries signals regulators must clarify classifications to protect licensed operators from overlapping products.
Prediction markets are facing growing pushback in Canada as provincial lottery operators argue their event contracts too closely resemble sports betting and are already cutting into regulated gambling revenue.
The Canadian Lottery Coalition maintains that these platforms offer products that compete directly with traditional offerings even as the operators insist they function as peer-to-peer financial instruments rather than centralized betting. The group is pressing for clearer rules before the sector expands further.
Canadian Lottery Coalition Demands Action on Event Contracts
In a statement cited by the Globe and Mail, the Canadian Lottery Coalition said: “We appreciate the further clarity, but I just feel like it’s too far to say that it’s a line in the sand. The time to act is now before they expand further in Canada.”
The CLC is not the only entity raising questions over the legality and exact status of event contracts. The debate echoes legal tensions in the United States, where similar platforms continue to overlap with sports betting territory.
Revenue Pressure and Regulatory Questions
This discussion unfolds as increasing numbers of young people view prediction markets and sports betting as a path to financial independence and a viable investment strategy. Neither Kalshi nor Polymarket is backing down, with betting revenue constituting the bulk of all trades on the platforms.
A CNN analysis recently discovered that the platforms are accepting billions from under-18 individuals. While event contracts on sports are framed as “not betting,” they still attract users who cannot access legal sports gambling, which is restricted to the age of 21 or more in most states.
In August the Canadian Investment Regulatory Organization (CIRO) and the Canadian Securities Administrators noted that event contracts tied to sports outcomes or entertainment should not be regulated as securities and derivatives. This matches the argument advanced by attorneys general and gaming regulators in the United States.
As reported by GamblingNews, the calls for restrictions underscore the competitive friction between established lottery operators and emerging prediction platforms.
Reporting: GamblingNews
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
Canada's lotteries want regulators to classify prediction markets as gambling before they lose more ground to unregulated platforms.
We've watched prediction markets pull billions in volume while regulators debate definitions. Canadian lotteries are now pushing back hard, claiming revenue loss — the same tension we're seeing in U.S. markets. This isn't theoretical anymore; it's a turf war over customers, compliance, and who controls event-based wagering going forward.
- Canadian lottery operators report revenue loss to prediction market platforms like Kalshi and Polymarket
- CIRO and CSA say sports event contracts shouldn't be regulated as securities, mirroring U.S. stance
- Platforms draw billions in trades, including from under-18 users unable to access legal sportsbooks
SCCG angle: SCCG works with regulators and operators across North America to navigate exactly these gray zones — product classification, competitive positioning, compliance architecture. When the lines blur between betting and prediction markets, we help clients structure offerings that protect market share and stay ahead of regulatory shifts through our regulatory and operator network.
Gaming, betting and prediction markets — the desk’s read, every weekday.
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