Canadian fintech Wealthsimple is launching a prediction markets app, Wealthsimple Predict, powered by Kalshi. The app will offer Canadian investors access to event-based contracts regulated as derivatives, following regulatory approval from CIRO.
Wealthsimple's launch brings regulated prediction markets to Canadian retail investors, while Kalshi navigates global regulatory challenges and expands into new derivatives markets, highlighting the evolving landscape of event-based and crypto derivatives trading.
Canadian fintech Wealthsimple is launching a new prediction markets app, Wealthsimple Predict, for its retail investors. The app, powered by Kalshi, will provide access to approximately 4,000 event contracts across various categories, including financial markets and economic indicators. This launch follows regulatory approval from the Canadian Investment Regulatory Organization (CIRO) in March, making Wealthsimple the second investment dealer authorized to offer such trading in Canada. The contracts will be regulated as derivatives and must have settlement periods of at least 30 days.
The expansion into Canada occurs as Kalshi faces significant regulatory scrutiny and legal challenges globally. Recently, Kalshi announced the launch of its perpetual futures products, marking an entry into the crypto perpetual futures market. This move has drawn pushback from established exchanges, with CME Group filing a lawsuit against the U.S. Commodity Futures Trading Commission (CFTC) over its approval of crypto perpetual futures contracts offered by Kalshi and similar products by Coinbase. CME argues the CFTC misclassified these products.
Prediction markets are also encountering resistance in other jurisdictions. Spanish regulators have ordered internet providers to block access to Kalshi and Polymarket, investigating potential violations of gambling regulations. In Asia, Indonesia banned Polymarket, and South Korean police have reportedly investigated local users for alleged gambling violations. In the United States, at least 11 states have challenged prediction markets, questioning whether event contracts should be regulated as gambling or as federally overseen derivatives. The conflict between the CFTC and state gambling regulators is seen by some as potentially heading to the U.S. Supreme Court.