Prediction markets are attracting significant attention in Canada, despite the prohibition on betting on election outcomes. Websites like Polymarket and Kalshi are facilitating substantial wagers on the upcoming municipal races in Ontario this October, with Polymarket seeing close to $400,000 in bets for the next Toronto mayor and Kalshi accumulating about $43,000.
These platforms are also hosting bets for cities like Oshawa, Oakville, and Mississauga, with total bets ranging from $5,000 to $40,000. Additionally, there is some activity on the online “social prediction game” Manifold, where users use play money instead of real currency.
While it is not illegal for non-Canadian prediction markets to accept bets on Canadian elections, Ontarians are prohibited from participating directly. Prediction markets in Canada are regulated, restricting wagers to climate, financial markets, or economic indicators, and available only through dealers authorized by the Canadian Investment Regulatory Organization (CIRO).
Polymarket is currently facing a two-year ban in Ontario following accusations by the Ontario Securities Commission of violating provincial securities laws in 2025.
Despite the restrictions, individuals in Canada can still potentially participate in betting on municipal elections using Virtual Private Networks (VPNs) to mask their location. However, both Polymarket and Kalshi have policies against VPN usage to bypass geographical restrictions, with monitoring mechanisms in place to detect such activity.
The potential risks associated with these wagers include influencing public perception of candidate chances, which could impact election outcomes. Young individuals, in particular, may be susceptible to making unwise betting decisions on these platforms, with significant marketing efforts targeting this demographic.
Both leading mayoral candidates in Toronto, Olivia Chow and Brad Bradford, have different reactions to the wagers, emphasizing the importance of voting over betting to drive political change.
Authorities in Canada, including the Ontario Securities Commission and the Canadian Securities Administrators, are expected to enforce regulations to safeguard investors participating in prediction markets. However, there are challenges in preventing individuals from circumventing these regulations, such as using VPNs to access unauthorized platforms.
CIRO reiterated its rules regarding authorized topics and investment dealers but did not outline specific measures to enhance regulatory enforcement in response to the growing popularity of prediction markets. Investors using VPNs to access these platforms are cautioned that they may not benefit from regulatory protections applicable when trading through CIRO-regulated investment dealers.
