Spain’s Consumer Rights Ministry temporarily banned so-called ​prediction markets Polymarket and Kalshi for operating ‌in the country without a gambling ​licence, the official ⁠state gazette showed on Tuesday.

In a statement, the ministry said its ‌gambling watchdog had opened a probe into the U.S.-based ‌companies for allegedly breaching local ‌rules ⁠by lacking mandatory administrative authorisation. ⁠The ban will last an estimated three or four months until the probe’s ​completion, it ‌said.

Prediction market users buy and sell stakes on the outcome of future events, with prices ‌reflecting the probability of ​one outcome or another occurring.

Spain, like other European jurisdictions, ⁠considers prediction markets a form of gambling when bets are placed ‌on uncertain outcomes.

The ministry said unauthorised operators lack the required technical and regulatory safeguards like identity verification systems, access control mechanisms for minors and for ‌people who have self-excluded or are banned ​from gambling, as well as the standards needed to ⁠protect users.

Once a niche corner ⁠of the internet, prediction markets have mushroomed into a ‌multi-billion-dollar industry after gaining a foothold in U.S. politics in ​2024.