The Secretariat of Prizes and Betting (SPA) responded with a public statement emphasizing that no Brazilian company has yet been authorized to operate such prediction-based businesses. While Kalshi has successfully gained a foothold through its partnership, the SPA noted it is maintaining "continuous and technical" monitoring. As specific rules have yet to be established, the entry standards and operational legality of this emerging sector remain without clear legal backing, leaving the market in a state of regulatory uncertainty.

The SPA has currently placed prediction markets on its internal priority analysis agenda and is reviewing technical notes submitted by industry firms to prevent a regulatory vacuum. A core challenge for regulators lies in determining jurisdiction, as it remains unclear whether prediction markets should fall under the authority of the Brazilian Securities and Exchange Commission (CVM) or the Ministry of Finance’s SPA. To ensure consistency with the existing legal framework, the SPA is coordinating closely with the CVM to define whether these products should be classified as financial instruments or gambling assets. This lack of jurisdictional clarity leaves prediction markets in an awkward position, fitting neither the traditional iGaming mold nor the established fixed-odds betting framework.

Kalshi’s entry comes at a sensitive time of turmoil for the Brazilian betting industry. Since the market opened in 2025, fixed-odds betting has faced pressure from phased tax increases set to reach 15%. Even more challenging are recent statements from President Lula, who unexpectedly called for a crackdown on online gambling, citing concerns over household debt. Legal experts point out that against a backdrop of tightening regulations and a firm presidential stance, prediction markets could become the next target for regulatory action. Without a clear legal status, this market risks driving consumers toward unregulated sectors and may face harsher administrative interventions in the future.