ESMA Confirms Existing EU Law Covers Most Prediction Market Contracts, Pending MiCA Rules for Tokenized Assets

According to ESMA's July 3 statement, event contracts that qualify as financial instruments under MiFID II derivatives categories are already subject to the EU's binary-options ban on retail sales, which has been in force since 2018 through member-state national measures. The authority clarified that no new legislation is required to apply this prohibition to prediction markets. Separately, ESMA noted that tokenized event contracts not classified as financial instruments may fall under the Markets in Crypto-Assets (MiCA) framework instead, which carries its own authorization and disclosure requirements.
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