B3 to Launch Bitcoin-Linked 'Event Contracts'

Brazil’s B3 stock exchange is set to launch six new ‘event contracts’ on April 27th. These contracts will allow investors to speculate on future outcomes, including the price of Bitcoin and fluctuations in currency exchange rates.

Designed for Professional Investors

The contracts are specifically designed for professional investors who meet certain criteria. To participate, investors must have at least 10 million reais (approximately $1.9 million) in assets or hold CVM certification.

How Event Contracts Work

A Prediction Market Framework

These 'Event Contracts' function similarly to prediction markets like Kalshi and Polymarket. Contract prices, capped at 100 reais, reflect the market’s collective assessment of an outcome’s probability.

The six initial contracts will cover mini futures and spot prices for the Ibovespa index, the U.S. dollar, and Bitcoin. Settlement will be cash-based, and traders will not take delivery of the underlying assets.

B3's Modernization Efforts

This launch is part of B3’s broader strategy to modernize derivatives trading within Brazil. Luiz Masagão, B3’s vice president of Products and Clients, stated the launch is a key component of this modernization push.

B3 already offers contracts linked to central bank decisions in various countries and has been closely monitoring the growth of predictive platforms internationally. The exchange is also developing its own tokenization platform and stablecoin, anticipated to launch later this year.

Brazil's First Regulated Prediction Market

B3’s move establishes the first federally regulated prediction market in Brazil. However, it enters a market that already includes platforms like Prévias and Palpitada, which have been operating in a less regulated environment. The global prediction market is experiencing significant growth, with notional volume nearing $160 billion.

Polymarket and Kalshi currently dominate the global prediction market space, accounting for the majority of trading volume. Intercontinental Exchange, the parent company of the New York Stock Exchange, has recently increased its investment in Polymarket.