The European regulator, ESMA, states that many prediction market contracts already fall under an EU retail ban. Companies cannot bypass financial rules by calling binary-style products 'event contracts' instead of derivatives.
ESMA, the European financial regulator, has issued a strong warning regarding prediction market event contracts. These are platforms where users bet on future outcomes. ESMA clarified that many such contracts, especially those similar to 'binary options' (bets with two possible outcomes), are already subject to an EU retail ban. This means they cannot be sold to everyday investors. The regulator emphasized that companies cannot simply rename these products as 'event contracts' to avoid existing financial regulations for 'derivatives' (financial products whose value comes from an underlying asset).
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