Key Takeaways
- The Canadian Investment Regulatory Organization (CIRO) now explicitly bans the offering or promoting of sports and entertainment-related event contracts.
- CIRO also newly defines event contracts and prediction markets after acknowledging increased interest in the products.
- Only two companies are officially authorized to offer prediction markets in Canada, and only under strict limitations.
Canadian financial regulators have further firmed up their stance on sports prediction markets.
The Canadian Investment Regulatory Organization (CIRO) updated its terms and conditions for its Investment Dealer Members that offer, trade, or facilitate trading in event contracts to note that sports and entertainment-related markets are explicitly banned.
Until now, those categories had been implicitly prohibited, in that CIRO only allowed markets on economic, financial, or environmental forecasts.
In August, CIRO and the Canadian Securities Administrators (CSA) publicly stated their stance that neither sports nor entertainment prediction markets should be allowed under Canadian federal securities or derivatives legislation. It added at that time that it did not consider it appropriate to authorize or facilitate its members offering those categories of contracts.
Now, CIRO has codified its position even further.
“Further to the August 27, 2026 joint CSA and CIRO guidance, CIRO does not consider it appropriate to facilitate or approve an application by its Investment Dealer Members to trade event contracts based on sports and entertainment events or outcomes,” said a CIRO statement published on Oct. 16. “In this respect, CIRO has specifically enumerated such contracts as prohibited in the updated terms and conditions.”
How does Canada define prediction markets?
In the updated guidance, CIRO also laid out its official definition of “event contracts”, stipulating that category includes “any product commonly described as an event contract, prediction contract, prediction market contract, or forecast contract.”
CIRO said that amendment is intended to ensure that its terms and conditions apply based on the functional nature of the product, regardless of the terminology or label used to describe it.
Promoting sports event contracts also banned
In addition, CIRO’s terms and conditions update specifies that not only may its members not offer the now explicitly banned sports or entertainment contracts, but they also cannot directly or indirectly advertise or display those banned markets. That means that companies like Wealthsimple that CIRO has approved to offer authorized event contracts may not simply turn off trading functionality for visible sports or entertainment contracts; instead, they must refrain from displaying them at all.
“CIRO and the CSA are concerned that the display or promotion of event contracts that Investment Dealer Members are not permitted to offer, trade, or facilitate trading in may create confusion regarding the products that have been authorized for access by Canadian clients,” said the regulator.
“We are also concerned that such practice may undermine the public interest rationale for the current conditions, even though the Investment Dealer Members are not making the event contract available to Canadian clients for trading.”
What kind of prediction markets are allowed in Canada?
CIRO is the national self-regulatory organization that oversees investment dealers, mutual fund dealers, and trading activity. As well as the ban on sports and entertainment markets, CIRO’s rules also limit binary event contracts in other ways, including only allowing prediction markets that take 30 days or longer to resolve.
CIRO is also the body with the authority to approve companies to facilitate Canadian access to prediction markets for trading. To date, it has issued such approval to just two companies: Interactive Brokers Canada and Wealthsimple.
Wealthsimple launched a new Wealthsimple Predict platform that offers at least 4,000 of Kalshi’s event contracts. However, unlike Kalshi’s modus operandi in the U.S., sports and entertainment contracts are forbidden for its Canadian partnership with Wealthsimple.
“CIRO’s position is clear: prediction-market products are not entitled to enter Canadian markets simply because they exist elsewhere,” a CIRO spokesperson told Canadian Gaming Business in June.
Other firms have applied to offer event contracts under CIRO’s rules. The regulator said in the new Oct. 16 announcement that it and the CSA will continue to monitor developments regarding event contracts and may provide further guidance or impose additional restrictions in the future.
In the meantime, U.S. giants like Polymarket that are not CIRO members are not authorized to offer prediction markets in Canada. Polymarket is serving a two-year ban in Ontario that expires next April, and it claimed earlier this year to have blocked access in several Canadian provinces.
However, it has been repeatedly reported that Polymarket still does accept trading in many parts of Canada, including on Canadian elections — a category that CIRO also does not authorize its approved members to offer.
