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Here is your latest predictions market news for Friday February 20, 2026. These are the top 3 news stories pertaining to the fast-growing predictions market Friday morning.
1 - Netherlands Bans Polymarket
The Netherlands Gambling Authority (Ksa) has imposed a penalty order on Adventure One QSS Inc., the operator of prediction market platform Polymarket, for offering what it called illegal gambling services in the country without a license. It marks the latest legal setback for the company as regulators worldwide intensify scrutiny of the sector.
In a statement published Tuesday, the Ksa said it had ordered Polymarket to immediately cease offering services to Dutch users. If the company fails to comply, it will be fined €420,000 ($462,000) per week, up to a maximum of €840,000 ($924,000).
“Prediction markets are on the rise, including in the Netherlands,” said Ella Seijsener, director of licensing and supervision at the Ksa. “These types of companies offer bets that are not permitted in our market under any circumstances, not even by license holders.”
2 - Sports-Focused Prediction Market Novig Raises $75 Million to Challenge Kalshi and Polymarket
Novig is announcing $75 million in fresh funding to compete with the two prediction market bigwigs, Kalshi and Polymarket.
“We started the company because we felt sports betting was broken,” cofounder Jacob Fortinsky told Fortune. “Our mission from day one was to build a platform really built for modern sports bettors in the most consumer-friendly, the most engaging, and the most profitable way possible.”
From Forbes:
Fortinsky started working on Novig in 2021 during his senior year at Harvard with cofounder Kelechi Ukah, entering the tech incubator Y Combinator the following year. During this time, however, the regulatory outlook for prediction markets was cloudy at best. (Polymarket would be banned from the U.S. in 2022 for offering unlicensed betting.)
Novig initially registered as a regulated sports betting operator in Colorado before switching to a sweepstakes model. Still, neither approach allowed Novig to operate nationally, and the latter led to legal challenges from state regulators. Now, Novig is applying to operate under the Commodity Futures Trading Commission, a process that, Fortinsky hopes, will be completed within six months.
Fortinsky insists that peer-to-peer sports betting is far more superior to that which is offered at traditional sports betting companies like FanDuel and DraftKings, though he could not offer a reason why Novig would be able to compete better with Kalshi or Polymarket, which already offer the peer-to-peer platform, and at very high volumes.
On a more fundamental level, Fortinsky says that Novig was built for sports, as opposed to Kalshi and Polymarket, which originally emphasized other types of contracts. “Our basic bet as a company is that the median sports fan is far more likely to use an app whose brand and whose product is really built with sports in mind, rather than with crypto or war in South America,” Fortinsky said.
3 - Kalshi Introduces New Hedging Tools
Kalshi in recent days has announced it is expanding into institutional hedging rather than just speculative event trading.It now provides real risk-management tools that function similarly to financial hedges.
This represents an evolution from “prediction markets” toward risk-management infrastructure.
Kalshi CEO Tarek Mansour further explains how the hedging option will work.
On sports hedging.
The sports insurance and re-insurance industry is big: the annual market is around $9 billion and is projected to double by 2030. There are a variety of insurance products including brand sponsorships, game cancellations, team/player performance, off player compensation, and more.
We just announced a partnership with sports insurance broker Game Point Capital.
Game point capital issues hundreds of millions in sports insurance per year. Their most popular product is team and player performance bonus insurance: sports teams often structure large payouts to coaches and players that get triggered if they achieve certain milestones (winning championship, making the playoffs, scoring records, etc.). The bill is often large and teams smooth out their finances by hedging it.
Game Point hedged for two different teams against performance bonuses on basketball with Kalshi last week:
1. One is a hedge for a bonus if the team makes the post-season (Kalshi price=6%, OTC price ~ 12-13%)
2. One is a hedge for a bonus if the team advances to the second round (price= 2%, OTC price ~7-8%).
Why did they do this on Kalshi?
Insurers like Game Point need to offload the risk they take on somewhere else. Typically, they go to traditional re-insurance companies like Lloyd's of London, which is Over-the-counter (OTC): you negotiate price and terms 1:1 with them (instead of an open/competitive market).
Like in all OTC markets, the issue is the re-insurers are restrictive in what risks they take: they like to avoid volatile, higher risk contracts, so they offer prices that are opaque and prohibitively high. Exchanges are a better alternative because they expand liquidity and bring competition: multiple counterparties compete in an open marketplace to improve the price.
Exchanges are harder to build than OTC because they need to have enough liquidity. Over the past year, we’ve massively increased the liquidity on our sports markets. During the Super Bowl, Kalshi could have processed a $22 million trade without moving the price meaningfully.
At this level of liquidity, Kalshi is now very attractive for Game Point and other similar companies: there’s more liquidity available, it's cheaper, and the price is more transparent. We expect to process tens of millions in similar hedges from Game Point alone in the coming months.
Onwards.
- Aaron Goldstein, Gambling911.com
