Malta’s Economy Minister Silvio Schembri this week said it was “actively exploring the emerging field of prediction markets, an area experiencing rapid global momentum which presents significant opportunities for innovation”.
He explained any changes to legislation would need to be “supported by a clear, forward-looking legislative framework that enables it to develop responsibly and at scale”.
Minister Schembri emphasised the critical importance of user trust. “We recognised early on that users need to feel safe if this industry was going to grow, which means it needed to uphold the highest standards of transparency and compliance.”
His comments came at the launch of Blockchain.com’s new Malta offices on wednesday, as reported by Business Now.
Strategic positioning in a rapidly evolving market
The global prediction markets sector has shown substantial growth in recent years. December 2025 saw record monthly trading with volumes exceeding $18 billion. Platforms such as Kalshi and Polymarket drove much of this expansion.
Prediction markets work like financial exchanges for real-world events. Participants buy and sell contracts tied to specific outcomes.
The challenge for regulators is that prediction market platforms don’t fit within existing compliance frameworks for gambling, and operators largely argue their product should be regulated as financial contracts trading.
The sourcing of the underlying data used to settle contracts, and the mechanisms for verifying outcomes, are now emerging areas of focus for regulators.
Across much of Europe, the official stance on prediction markets is they are treated either as illegal gambling or as unlicensed financial instruments, as no regulatory frameworks exists yet.
Many European jurisdictions have taken steps to block access to Polymarket, including Germany, Belgium, Portugal, Switzerland, Romania, the Netherlands and Poland. These markets have argued that the platform offers gambling services without a licence.
Malta could be the first European market to produce a framework specific to prediction markets.
