Prediction markets hit legal wall in the Philippines

Abi Bray

27 October 2025 at 8:20am UTC-4

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While prediction markets have seen rapid growth worldwide, they remain illegal in the Philippines, and there is no immediate sign of that changing.

Under the Philippines Revised Penal Code and a 2017 executive order, any wager on an uncertain outcome counts as gambling unless licensed by the country’s regulator, PAGCOR.

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PAGCOR has not issued a license for prediction markets, making any real-money operation illegal. Even bets on Philippine elections are expressly banned under the Omnibus Election Code.

Experts suggest that the only way a local platform could legally operate would be to remove real-money stakes and turn it into a “play for fun” model.

Prediction markets are online platforms on which users can bet on future events. Instead of wagering at a traditional bookmaker, they allow users to buy and sell positions on potential outcomes against one another. They are also mainly regulated under the same rules as commodity futures trading.

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Global trading volumes in this new sector topped US$2 billion in a single week this October, driven by wagers on elections, sports, and pop culture.

Additionally, the owner of the New York Stock Exchange, the Intercontinental Exchange, recently announced a US$2 billion investment in Polymarket, valuing the company at about US$8 billion.

Abi Bray brings strong researching skills to the forefront of all of her writing, whether it’s the newest slots, industry trends or the ever changing legislation across the U.S, Asia and Australia, she maintains a keen eye for detail and a passion for reporting.

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The Backstory

What set the stage

Prediction markets have surged into the mainstream on a wave of retail trading, crypto-native liquidity and headline-driven speculation. Weekly global volumes have swelled into the billions, fueled by wagers tied to elections, sports and pop culture. Yet the Philippines remains an outlier. Local law treats any wager on an uncertain outcome as gambling unless licensed by the Philippine Amusement and Gaming Corp., better known as PAGCOR. With no licenses issued for prediction markets and explicit election-bet bans still on the books, the country’s market has been effectively fenced off from a global boom.

That dichotomy — growing demand versus rigid rules — mirrors broader regulatory tensions playing out far beyond Manila. In the United States, the Commodity Futures Trading Commission has moved to police the line between event contracts and traditional gambling, pressing big-name platforms to stop products it says fall afoul of derivatives rules. The debate now stretches from administrative tribunals to state courts and could eventually land at the Supreme Court, a path that shapes incentives for incumbents and newcomers alike.

The stakes are straightforward. If event contracts are treated as regulated financial instruments, large brokerages and exchanges could enter with scale and compliance muscle. If contracts are deemed gambling, they fall to state gaming regimes that vary widely in permissiveness, geography and politics. In the Philippines, the answer today is simpler: no real-money prediction markets absent a PAGCOR license, which does not exist.

A U.S. crackdown reverberates

The CFTC’s scrutiny has already hit well-known consumer platforms. Robinhood rolled out a Pro Football Championship market early this year, then suspended it after the regulator said the product did not comply with derivatives rules. The company disclosed the halt while reporting a stronger quarter, underscoring how regulatory risk can collide with otherwise solid business performance. In its latest update, Robinhood said second-quarter revenue rose 45% to $989 million, with net interest revenue and EBITDA beating forecasts. Growth in higher-yield products like Robinhood Gold and retirement accounts helped offset the setback on event contracts, but the message to would-be imitators was clear: U.S. regulators are not giving prediction markets a free lane.

The U.S. clash matters in Manila because definitions travel. If courts treat some event contracts as swaps under federal law, it strengthens the argument that these instruments are closer to financial derivatives than casino bets. If courts, Congress or agencies wall them off as gambling, it bolsters the view — already dominant in the Philippines — that they belong inside a gaming regulator’s remit, with all the licensing, geofencing and consumer protections that entails.

Incumbents bide their time

Traditional sportsbook operators have reason to tread lightly. A legal briefing summarized by Jefferies captured why. In a Sept. 15 note, the bank relayed a specialist’s view that open questions around event contracts leave online sports betting leaders like DraftKings and Flutter’s FanDuel on the sidelines for now. The analysis outlined three pathways: a congressional clarification, a Supreme Court ruling or harmonized lower-court decisions. Each would take time. Meanwhile, firms with federal derivatives strategies can test boundaries, including in states where sports betting remains illegal, while legacy operators risk political blowback if they move too fast.

For the Philippines, that pause means less pressure from global sportsbook brands to push PAGCOR toward a new category. It also means the competitive threat that prediction markets pose to traditional parlays and props remains mostly theoretical. If U.S. courts ultimately classify sports-related event contracts as swaps, that could invite large, compliant players to reenter with momentum. If not, incumbents maintain the status quo and the Philippines’ bright lines stay intact.

A consumer blind spot at home

Enforcement only works if consumers understand the rules. In the Philippines, many do not. More than half of online gamblers told researchers they are unaware of the legal risks on unregulated sites. Just 12% thought the rules were clear. Skepticism about platform fairness ran high and frequent users reported higher-stakes play. Those findings suggest any gray-market prediction product — even without explicit local licensing — could draw real money from users who underestimate legal exposure and overestimate protections. That is the scenario regulators try to avoid when they draw bright lines.

The knowledge gap also raises consumer-protection questions that go beyond prediction markets. Cross-border sites, crypto rails and mobile access make it easy to skirt domestic rules. Without clear education and consistent penalties, the Philippines risks a two-track reality: a formal market bound to PAGCOR licenses and an informal market that thrives on confusion. If prediction markets remain unlicensed, the latter becomes the default channel for curious bettors, compounding risks that regulators and policymakers have flagged.

Money keeps chasing growth

Even as rules tighten in some places, capital is flowing into betting and adjacent products. Research Insights projects the global sports betting market will reach $182.12 billion by 2030, driven by mobile access, regulatory openings in the United States and Latin America, and tech like AI-driven personalization. Media tie-ups and celebrity marketing are expected to add fuel. That growth math reinforces why event contracts have become a point of friction: they blur boundaries between speculative trading and gambling at a time when both categories are scaling.

Public-market performance has echoed that appetite. Robinhood’s breakout quarter shows that investor demand for trading, yield and new product lines remains strong even when specific offerings face regulatory roadblocks. The company’s retreat on a single event market did little to dent broader momentum, a reminder that large platforms can absorb setbacks if the underlying user and revenue engines are healthy.

Signals from the local industry

PAGCOR’s influence reaches beyond outright bans. Global suppliers are building capacity in the Philippines under the regulator’s umbrella, strengthening the formal ecosystem. Evolution, a live casino and slots provider, opened its first Asia live studio in the country while reporting second-quarter net revenue of $607.4 million and an EBITDA margin near 66%. The launch reinforces Manila’s role as a regional hub for licensed operators and vendors. It also underscores the contrast with unlicensed prediction markets: the former are growing with clear oversight, the latter remain off-limits.

That bifurcation is likely to persist. Unless PAGCOR creates a licensing path for real-money event contracts, local platforms must stick to play-for-fun models. Any shift would require regulators to square event-contract mechanics with existing gambling and securities frameworks, define consumer safeguards and reconcile election prohibitions with demand for political forecasting. Given the complexity and the education gap among users, a quick pivot looks unlikely.

Globally, litigation and legislation will continue to shape what happens next. If U.S. courts bless a narrow set of event contracts as permissible financial products, momentum could swing toward exchange-style venues with stronger compliance programs. If not, prediction markets will remain boxed into gambling regimes where regulators like PAGCOR have little incentive to loosen controls. For now, the Philippines’ legal wall holds, even as money and attention keep pressing against it.