The New Zealand government has issued a fresh crackdown on prediction markets after ordering both Kalshi and Polymarket to withdraw from the country.

In a warning issued by the Department of Internal Affairs (DIA), the two operators were told they are not permitted to offer markets on future outcomes to players across New Zealand.

Kalshi and Polymarket have continued to make headlines in the US in recent weeks as more state regulators crack down on prediction markets; now, we’re seeing regulators in markets further afield follow a similar path.

New Zealand has become the latest country to label both Kalshi and Polymarket as gambling platforms after reports circulated that bets were being offered on multiple country-specific events, ranging from provincial cricket results to terms of phrase being used by politicians.

Responding to questions for SBC News, Vicki Scott, Director of Gambling at the DIA, commented: “On 16 February, DIA wrote to prediction markets Polymarket and Kalshi, confirming that their prediction market products meet the definition of gambling under New Zealand law. 

“As well as the general gambling rules, there are also specific restrictions on betting products, which only allow TAB NZ to provide racing and sports bets in New Zealand.”

In New Zealand, TAB was granted a monopoly over online betting, with its commercial betting and broadcasting services outsourced to UK gambling firm Entain on a 25 year lease. A separate bill to introduce iGaming is currently passing through Parliament, which would open up the market for a total of 15 licence holders.

“The prediction market operators are not authorised to offer gambling in this country, so need to withdraw from the New Zealand market,” Scott added.

“We were pleased to see Kalshi acting swiftly. Within hours it had added New Zealand to its list of prohibited countries. We are monitoring Polymarket in the expectation that it will take a similarly professional approach and comply with the law in New Zealand.”

A not so predictable future

The landscape for prediction markets has been the topic of much discussion across the industry in the first two months of 2026, particularly in the US.

Stateside, they are overseen by the Commodity Futures Trading Commission (CFTC), which regulates the sale of commodity and financial futures and options. 

In Europe, multiple countries have issued an outright ban against Polymarket, while other jurisdictions – some of which, on the surface, seem more open to the concept of prediction markets – are adamant that they will treat prediction markets as gambling if they ever decide to enter.

The DIA echoed a previous statement by the Australian Communications and Media Authority from last year, which came to the same conclusion for Polymarket.

And while controversial elsewhere, over in the US the Federal Reserve recently concluded that companies like Kalshi “can serve as a valuable complement to existing forecast tools in both research and policy settings” when it comes to the analysis of macroeconomic indicators – signalling that prediction markets are here to stay.