Prediction market websites like Polymarket and Kalshi are defying the ban on election outcome betting in Canada by accepting substantial wagers on the upcoming municipal races in Ontario this October. Polymarket has seen nearly $400,000 in bets placed on the next Toronto mayor, with Kalshi also attracting around $43,000 in bets. Other cities like Oshawa, Oakville, and Mississauga have accumulated bets ranging from $5,000 to $40,000. Additionally, some betting activity is taking place on the online game Manifold, where play money is used instead of real currency.
While non-Canadian prediction markets can legally accept bets on Canadian elections, Ontarians are prohibited from participating in such activities. Prediction markets in Canada are regulated, limiting wagers to predictions on climate, financial markets, or economic indicators, and are only accessible through dealers authorized by the Canadian Investment Regulatory Organization (CIRO). Polymarket has faced a two-year ban in Ontario following allegations of breaking provincial securities law in 2025.
Despite the restrictions, Canadians can easily bypass them using VPNs, as explained by Cristie Ford, an associate professor at the University of British Columbia specializing in financial regulation. However, Polymarket and Kalshi have differing approaches to VPN usage, with Polymarket strictly prohibiting it, while Kalshi claims no evidence of VPN use for betting on Ontario races due to stringent identity verification processes.
The primary concern with election betting, according to Ford, is the potential influence on public perception of candidates and voter turnout. Young individuals, particularly men, are susceptible to risky betting decisions on these platforms due to targeted marketing efforts. Notably, Toronto mayoral candidates Olivia Chow and Brad Bradford have responded differently to the wagers, with Bradford emphasizing voting over betting for political change, while Chow suggested diverting betting funds to charitable causes like the library foundation.
Enforcement of rules on prediction markets in Canada falls under the jurisdiction of the Canadian Securities Administrators and the Canadian Investment Regulatory Organization. While these agencies expect compliance with regulatory obligations, challenges persist in identifying the responsible authority for enforcing regulations. CIRO has reiterated its rules and warned investors against circumventing geographic restrictions through VPNs, emphasizing the lack of regulatory protection in such cases. Efforts to enhance regulation enforcement are ongoing, with updates awaited from the Canadian Securities Administrators.