WLA warns: prediction markets without a local license "operate illegally"

WLA warns: prediction markets without a local license "operate illegally"

WLA warns: prediction markets without a local license "operate illegally"

The world lottery association presented its position paper on prediction markets at the APLA conference in Seoul and called for them to be subject to the same licensing and player protection requirements as betting.

The World Lottery Association (WLA) has hardened its stance on prediction markets during the APLA conference on sustainable gaming, innovation and new trends, held in Seoul, South Korea. Its executive director, Luca Esposito, presented the organisation's position paper with an unequivocal warning about the nature of these platforms when they operate without authorisation.

"Prediction markets that offer contracts on sporting or lottery events without a proper local license are operating illegally. Renaming bets as 'contracts' and players as 'traders' does not change the legal nature of the activity," Esposito said.

The document calls for urgent alignment between gambling regulators and those of the financial markets to close regulatory loopholes and ensure that prediction markets are subject to the same standards of licensing, integrity, return to society and consumer protection as betting. The WLA urges the various actors to act without delay.

In this sense, the text proposes three lines of action: that WLA members proactively engage with regulators to keep them duly informed; that regulators and governments require any entity that offers financial contracts on event outcomes to obtain the corresponding gaming or betting license before operating; and that sports and integrity monitoring bodies incorporate prediction markets into their surveillance frameworks and suspicious transaction reporting (STR) obligations.

The conference kicked off with opening remarks by host DongHang Lottery Company, the Korea Lottery Commission and WLA President Andreas Kötter. In his presentation, Kötter provided an overview of industry trends and highlighted data from the WLA Global Lottery Data Compendium on global sales by region in 2025, with Asia leading the way, a few percentage points ahead of Europe.

Kötter also reviewed the main initiatives deployed by the association to support its members over the last year. These include the position paper on prediction markets itself, developed in response to the rapid and largely unregulated expansion of this type of platform.

Added to that work is a joint project with the School of Criminology of the University of Lausanne, which has resulted in a solvent framework for sizing illegal gambling markets. He also cited Project RED, a specific resource that offers tools and strategies to help member lotteries address responsible gambling, environmental challenges and corporate social responsibility issues in a broader sense.

Finally, Kötter referred to the partnership with East Carolina University's Gambling Research & Policy Initiative and the Reaching Emerging Adults microsite, conceived as a resource center to help members understand and respond to gambling risk among young adults.