In April 2026, three Brazilian State bodies converged on prediction markets within seven days, closing three regulatory fronts at once — derivatives, betting and electoral. CMN Resolution No. 5,298 prohibited framing these contracts as derivatives, while SEI Technical Note No. 2,958/2026/MF qualified them as illicit exploitation of fixed-odds betting. Rather than create a dedicated regime for event contracts, Brazil reaffirmed existing perimeters and applied them in full to the non-financial underlying.
The three-front siege
On April 23 and 24, 2026, the National Monetary Council (CMN), the Secretariat of Prizes and Betting (SPA) and, through prior regulatory chaining, the Superior Electoral Court (TSE) converged with coordinated decisions. CMN Resolution No. 5,298, which takes effect on May 4, 2026, expressly prohibits framing as derivatives any contracts referenced to real sports events, virtual online-game events, or political, electoral, social, cultural and entertainment events that the CVM does not consider an economic-financial reference; art. 4 extends the prohibition to foreign derivatives offered within national territory. In parallel, SEI Technical Note No. 2,958/2026/MF, grounded in PGFN Opinion No. 1,323/2026, concludes that prediction markets constitute fixed-odds betting exploited illicitly whenever three elements are present: a future and uncertain event, assumption of risk through financial outlay, and expectation of a prize predetermined by a multiplier.
Divergence from the U.S. model
In the United States, the CFTC upheld the framing of event contracts as swaps under the excluded commodity category of the Commodity Exchange Act, giving Kalshi and Polymarket a basis to operate contracts on elections, sports and political events. That thesis is losing ground: recent rulings in Massachusetts and Nevada upheld state-level prohibitions on Kalshi for sports contracts, treating them as betting rather than derivatives regardless of federal labeling. By opting for simultaneous prohibition across three bodies, Brazil preempted that dispute — there is no institutional boundary to arbitrate. The consolidated matrix leaves derivatives on traditional financial references (Ibovespa, USD, Selic, BTC, commodities) permitted, where B3, BTG Trends and XP/Kalshi continue to operate, while Kalshi has already begun blocking Brazilian access and provider-level blocking of both platforms is expected under the SPA's enforcement recommendation.
Key findings
- On April 23-24, 2026, the CMN, the SPA and the TSE converged to close three fronts on prediction markets in seven days.
- CMN Resolution No. 5,298, effective May 4, 2026, expressly prohibits framing contracts on non-financial events as derivatives.
- SEI Technical Note No. 2,958/2026/MF, grounded in PGFN Opinion No. 1,323/2026, qualifies prediction markets as illicit fixed-odds betting.
- The SPA recommends blocking Brazilian access to Polymarket and Kalshi under art. 17 of Law No. 14,790/2023, and Kalshi has already begun blocking users.
- Derivatives on economic-financial references such as Ibovespa, USD, Selic, BTC and commodities remain permitted, where B3, BTG Trends and XP/Kalshi continue to operate.