LDP caucus to take up prediction markets, with gambling law alignment in focus

RegulationDigital Finance
โดย NADA NEWS·JP·Read original
Summary · why it matters

The Digital Frontier Finance Parliamentary League, a caucus of lawmakers within Japan's Liberal Democratic Party, is expected to begin studying how to handle "prediction markets," where participants trade on forecasts of future events such as election results and economic indicators, according to party officials interviewed by NADA NEWS. The caucus was established in 2023 by developing and dissolving the Commodity Futures Trading Promotion Parliamentary League, which had worked to promote commodity futures trading, and includes online banks, securities firms, and crypto asset exchanges among its participants. In prediction markets, Kalshi and Polymarket of the United States are the leading players, with monthly trading volume reaching the tens of billions of dollars, and some forecasts see the market hitting 1 trillion dollars by 2030. On the other hand, the New York State Attorney General filed suit on April 21, arguing that the prediction market services of Coinbase and Gemini are illegal gambling that violates state law, and sought a total of 3.4 billion dollars in damages. In Japan as well, at the House of Councillors Finance and Monetary Affairs Committee on April 21, opposition Democratic Party for the People Councillor Shuichi Harada raised prediction markets in the Diet for the first time, and Toshitake Inoue, Director-General of the Financial Services Agency's Planning and Markets Bureau, said the agency currently has no regulatory law covering them, adding that given the risk they could be regarded as gambling, "we need to respond with extreme caution." Under current law, a mechanism in which people stake their own funds and vie for gains or losses of property depending on the outcome cannot be ruled out as falling under the criminal offense of gambling, so the barriers to introducing or expanding such businesses remain high. Still, a party official said it is highly significant that an LDP parliamentary caucus has decided to treat prediction markets as one of its discussion topics, and revealed that executives from Kalshi and Polymarket are planning to visit Japan soon.

Impact on stocks 2

Digital Finance & Tokenization▼ · 2 stocks
Coinbase Global Inc
COIN
▼ NegativeRegulationrelevance

New York State Attorney General sued Coinbase, alleging its prediction market services are illegal gambling and seeking damages.

Theme Impact 2

Off-coverage companies 2

KalshiPrivate± Mixed
Regulationrelevance

Kalshi is named as a leading US prediction-market player as Japan's LDP caucus studies how to regulate such markets.

PolymarketPrivate± Mixed
Regulationrelevance

Polymarket is named as a leading US prediction-market player as Japan's LDP caucus studies how to regulate such markets.

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