Brazil’s main stock exchange, B3, is set to launch six new derivatives contracts on April 27, enabling investors to speculate on future events, including the pricing of bitcoin, dollar fluctuations, and movements in the Ibovespa index. These new financial instruments, termed Event Contracts, are designed to operate similarly to established prediction markets such as Kalshi and Polymarket. Each contract is priced up to 100 reals (approximately $19), and the price represents the market’s estimated probability of a specific outcome occurring.
The contracts on B3 will be regulated by Brazil’s securities authority (CVM) and are intended for professional investors only. The six contracts will cover mini futures and spot prices related to the Ibovespa index, the U.S. dollar, and bitcoin. These contracts are structured to provide fixed payouts with known risks from the outset, akin to the prediction markets in the crypto space. Importantly, traders will not receive the underlying assets, and all settlements will occur in cash.
Currently, only investors who hold over 10 million reals (about $1.9 million) in assets or possess certification from the CVM will be eligible to trade these new products. Luiz Masagão, B3’s vice president of Products and Clients, emphasized that this launch is part of a larger initiative to modernize the landscape of derivatives trading in Brazil. He noted that the exchange has already introduced contracts linked to central bank decisions in various countries and has been closely tracking the growth of predictive platforms internationally.
In addition to this initiative, B3 announced plans for developing its own tokenization platform and stablecoin, both of which are expected to be launched later this year. The introduction of these events contracts marks the first federally regulated prediction market in Brazil. Despite this advancement, the sector is becoming increasingly competitive. Other platforms, including Prévias and Palpitada, have been operating within a regulatory gray area. Moreover, U.S. firm Kalshi has teamed up with XP International, Brazil’s leading brokerage, to offer event contracts related to Brazilian economic indicators.
The timing of B3’s launch coincides with a global surge in prediction markets, where the notional trading volume is approaching $160 billion and the unique user base has surpassed 3 million. Globally, Polymarket and Kalshi dominate this market, accounting for a significant portion of the total trading volume. The Intercontinental Exchange, which owns the New York Stock Exchange, has made substantial investments in Polymarket, raising its total commitment to nearly $2 billion.
Despite the enthusiasm surrounding these developments, the regulatory landscape remains complex and uncertain on both sides of the Atlantic. In Brazil, legal experts are debating whether regulation of prediction markets should fall under the purview of the CVM, the Central Bank, or the Ministry of Finance, leaving the future of these innovative financial products in a precarious position.
