Executive Summary
- The proposed combined retail launch is unlawful without the relevant permissions, and financial authorisation would not remove the Dutch retail binary-options prohibition. The specified inflation and earnings derivatives fall within that prohibition. The football wager requires a separate Dutch gambling analysis and cannot use professional-client status as a gambling exemption. (AFM, Verbod op binaire opties, Stcrt. 2019, 21122, arts. 1–2; Wet op de kansspelen, art. 1(1)(a).)
- ESMA's statement of 3 July 2026 does not classify every prediction market as a financial product. The underlying must first bring the contract within MiFID II Annex I, Section C(4)–(10). A qualifying financial event contract then faces the applicable national binary-option measure. A nonfinancial contract may instead engage gambling law or MiCA. (ESMA35-243228190-8148, pp. 1–2 and nn. 1–4.)
- A documented professional financial-services route exists under Dutch law. A third-country firm providing investment services only to per-se professionals or eligible counterparties can seek the national permission under Wft article 2:99b; article 2:99 addresses own-account activities. The proposed licensed route requires actual authorisation, a Dutch representative and the statutory supervisory conditions. A narrower own-account-only exemption has separate conditions. Elective professionals fall under the different branch route in article 2:99a. Neither route constitutes an unrestricted EU passport. (Wft, arts. 2:96 and 2:99–2:99b; Vrijstellingsregeling Wft, art. 10a; AFM, Third country policy; AFM, Investment firms, licence application requirements.)
- Peer-to-peer execution does not make the operator passive. An automated financial order book can constitute an MTF; a single-dealer service requires a genuinely bilateral design. For gambling, Ksa's 2026 Polymarket decisions reject the proposition that matching users removes the organiser's responsibility. (MiFID II, arts. 4(1)(19), 4(1)(22), 18–19; Ksa, Adventure One QSS Inc., decision on objection, 23 June 2026, paras. 53–61.)
- A MiCA CASP permission cannot replace an investment-firm permission or a Dutch gambling licence. Financial instruments are excluded from MiCA's product scope. Separate custody, exchange or transfer of payment tokens may still require crypto-asset and payment-services permissions. (Regulation (EU) 2023/1114, arts. 2(4)(a), 3, 59–60 and 70(4).)
- South African operation requires its own permissions. Genuine FMA-regulated activities benefit from the statutory gambling exclusion, but a crypto label or FAIS permission alone does not establish that exclusion. Unlisted derivative issuance, securities matching and ordinary betting require separate classification. Foreign targeting does not itself remove those domestic requirements. (Financial Markets Act 19 of 2012, ss. 1, 3(2), 7 and 9; Financial Markets Act Regulations, 2018, regs. 1–2; National Gambling Act 7 of 2004, ss. 4–5, 8 and 11.)
- Block Dutch cash football access and publish only a no-payout forecasting version. For inflation, pursue a fiat-only institutional financial structure before admitting any Dutch trader. Publish earnings forecasts without tradable payouts initially; reserve a financial version for the same separately authorised institutional channel. If Ksa instead treats either economic contract as a non-sports wager, professional status cannot make that gambling offer licensable. (Besluit kansspelen op afstand, art. 2.1; Ksa, decision on objection, 23 June 2026, paras. 38–43.)
The contracts and the operator's role
The proposed service must be tested as an operating business. Assume the South African company sets questions, matching rules, fees and the settlement procedure. It controls the website and matching engine. Opposing users contract with each other; the company initially acts as organiser and execution intermediary. A guarantee or novation making the company responsible for each payout would change that counterparty analysis. Calling a guaranteed position peer-to-peer would not preserve the assumed agency model.
Each matched pair is fully funded and unleveraged. A winning position creates a euro-denominated claim for €1; the losing position pays zero. The buyer can lose the purchase price and fees. Assume issuance occurs fewer than 90 calendar days before expiry. Positions may be assigned or novated to another approved user through the matching engine before trading closes. Transferability changes the execution analysis but is not a necessary condition for an OTC derivative. (MiFID II, Annex I, Sections A and C.)
Fiat initially enters a pooled South African bank account against individual customer ledgers. The operator controls private keys for stablecoins received as funding. These assumptions identify custody exposure; they do not establish legally effective segregation or bankruptcy protection. The event obligation remains payable in euros even when a customer funds it with a stablecoin. A redesign making the obligation payable only in a crypto-asset would require a separate settlement analysis. (MiFID II, art. 16(8)–(9); MiCA, arts. 3(1)(17) and 70.)
The football contract asks whether the named home team wins after 90 minutes plus stoppage time, excluding extra time and penalties. The rules identify the competition organiser's official result and prescribe voiding and refunds for an unresolved abandonment. The inflation contract asks whether a specified month's Dutch all-items CPI annual rate, in the designated CBS release, exceeds a hypothetical 3% threshold. The earnings contract asks whether an unnamed Dutch-listed company's published diluted earnings per share for a specified period exceed a hypothetical €1 threshold. These figures define proposed terms and are not reported market data.
The operator's oracle records the specified official result or publication. Rules must distinguish a correction from a later statistical revision or accounting restatement. They must fix the observation time, trading halt, dispute procedure and fallback for delayed publication. An oracle vendor or smart contract cannot remove the operator's responsibility for rules it selects. The company would market the original cash service to Dutch residents through localised pages and campaigns. Access to other EU countries would remain blocked pending separate national analysis.
A nontransferable token that merely records a contractual position is evidence of that position. A token whose transfer carries the enforceable payout right is the instrument's digital form. Neither structure permits classification from the token's name alone. Negotiability can also require testing the transferable-security category; a transferable token is not automatically a transferable security. (MiFID II, art. 4(1)(44) and Annex I, Section C; MiCA, arts. 2(4)(a) and 3(1)(5).)
ESMA's event-contract statement and the Dutch retail prohibition
The financial-instrument test comes first. ESMA's July 2026 statement addresses event contracts whose underlying belongs to MiFID II Annex I, Section C(4)–(10). A binary payoff alone does not establish that threshold. ESMA then applies national binary-option restrictions to qualifying derivatives, irrespective of the provider's chosen terminology. Its statement is supervisory guidance, not a new product category or an individual authorisation. (ESMA35-243228190-8148, pp. 1–2.)
The binding Dutch measure prohibits marketing, distribution and sale of covered binary options to retail clients in or from the Netherlands. It applies on and off trading venues. The derivative must settle, or permit settlement, in cash, apart from default or another termination event; it pays only on early termination or maturity. Its payment takes predetermined fixed or zero amounts according to whether specified conditions occur. The modelled economic contracts meet those elements. Full collateralisation, early resale and the absence of leverage do not remove them. (AFM, Verbod op binaire opties, art. 1(1)–(2).)
The exceptions are narrow. One requires the lower payout to cover the retail buyer's entire outlay, including fees. The other requires all three conditions: at least 90 calendar days from issuance to maturity, a publicly available approved prospectus meeting the measure's requirement, and no market-risk exposure or profit or loss for the firm or its group except disclosed charges. The model fails the first exception because the losing payout is zero. Its assumed duration defeats the second, irrespective of its peer-to-peer funding. (AFM, Verbod op binaire opties, art. 1(3).)
A funding coupon cannot be added merely to relabel the payoff and evade the measure. ESMA addresses that attempted distinction expressly, while the Dutch decision separately prohibits deliberate circumvention. Nor does a prospectus, risk warning or successful knowledge test override the retail prohibition. The operative Dutch restriction is the national measure adopted under MiFIR article 42 and Wft article 1:77f, rather than an indefinitely renewed ESMA emergency measure. (ESMA35-243228190-8148, p. 2; AFM, Verbod op binaire opties, arts. 1–3 and explanatory memorandum, paras. 3–5.)
The football contract
The plain match-result contract should be treated as a sports wager. Participants pay for a chance to receive money, and participants generally cannot predominantly influence the match result. Expertise in pricing the chance does not establish control over the winning event. The Dutch gambling prohibition therefore applies unless a suitable licence covers the actual offer. (Wet op de kansspelen (Wok), art. 1(1)(a); Ksa, Leidraad beoordeling kansspelen, sections 4–5.)
Football scores do not enter MiFID merely because the website quotes prices between zero and one. They are not the specified securities, currencies, rates or financial measures in Section C(4), nor the expressly named inflation or official economic statistics in C(10). A different construction invoking C(10)'s residual underlyings still requires a positive classification of the right and its derivative characteristics. The platform cannot assume that every contingent payment satisfies that residual category. On the plain sports terms, the gambling route is the appropriate launch analysis. (MiFID II, Annex I, Section C(4) and C(10); ESMA35-243228190-8148, p. 1.)
A Dutch remote-gambling licence can cover qualifying sports betting. That possibility does not authorise the proposed operator, its exchange mechanism or its stablecoin cashier. The licence application must encompass the actual rules and operating arrangement. A professional-only sports lobby provides no exemption under Wok article 1. If the actual sports-linked right also satisfies a residual financial-instrument category, the financial permission and binary-option tests must also be applied. That result would not itself settle Dutch gambling competence. (Wok, arts. 1 and 31a; Besluit kansspelen op afstand (Bkoa), art. 2.1.)
The recommended first launch excludes Dutch cash football trading. The company can retain a public forecasting question with no prize or transferable payout right. A later Dutch sports-betting project would require its own licensed structure and approved operating model; it should not be carried inside the proposed institutional economic-derivatives service.
The inflation contract
The specified CPI contract has a direct MiFID classification. Section C(10) expressly includes derivatives relating to inflation rates or other official economic statistics that must, or may at a party's option, settle in cash. The right is contingent on the designated inflation release and creates a euro payout. Its standardised yes-or-no drafting and short duration do not displace those elements. Wft article 1:1 implements the financial-instrument classification in Dutch law. (Directive 2014/65/EU (MiFID II), Annex I, Section C(10); Wft, art. 1:1.)
Retail distribution is prohibited because the financial derivative also meets the Dutch binary-option definition and neither modelled exception applies. A non-retail channel requires authorisation for the operator's actual activities and services unless a specific exemption applies. The proposed institutional route below is preferable to seeking a retail exception that would require changing the economics or maturity and prospectus arrangements. (AFM, Verbod op binaire opties, art. 1; Wft, arts. 2:96 and 2:99–2:99b; Vrijstellingsregeling Wft, art. 10a.)
The strongest adverse interpretation is that the offered arrangement is a chance-based prize scheme over an economic event rather than the genuine financial business described in the application. If Dutch gambling law applies on that basis, an inflation bet is not one of the sports or horse-racing bets admitted by Bkoa article 2.1. Restricting the audience to professionals would then fail. The company must resolve that classification conflict before activating the financial channel. (Wok, art. 1(1)(a); Ksa, Leidraad, section 3.2; Ksa, decision on objection, 23 June 2026, paras. 38–43.)
The corporate earnings contract
A contract on a defined published diluted-EPS threshold is a derivative relating to a financial measure under Section C(4). The operative fact is the accounting metric that determines the payout. A question about a chief executive's resignation or an unrelated corporate announcement would require fresh classification; the issuer's corporate identity alone supplies no financial underlying. The specified cash-settled EPS derivative falls within the Dutch retail binary-options prohibition. (MiFID II, Annex I, Section C(4); Wft, art. 1:1; AFM, Verbod op binaire opties, art. 1.)
The professional permission route is legally available on the same financial-classification conditions as for inflation. Its product approval must address unpublished earnings information, access by issuer employees and the operator's ability to change the settlement metric. The contract needs an exact reporting period, accounting definition and rule for a corrected release. Information barriers, restricted-person controls and surveillance are proposed responses to those conflicts, not substitutes for the operator's financial permissions. (MiFID II, arts. 16(3), 16(6) and 23–24.)
For the first public product, remove the tradable EPS payout and publish forecasts or aggregated probabilities. An institutional version can follow through the separately authorised financial channel. This sequencing reflects the additional information and oracle risks; it does not treat every earnings derivative as an unlicensable bet. If Ksa instead classifies the offered arrangement as non-sports gambling, Bkoa article 2.1 supplies no professional-only escape.
When finance and gambling overlap
The Dutch tests must be applied separately without presuming two licences are always necessary. Wok article 1 uses a broad prize-and-chance test. MiFID uses financial-instrument categories. An arrangement can satisfy the language of each test, while questions about legislative scope and regulatory competence determine the consequences. ESMA expressly preserves national gambling classification. Its separate MiCA reference concerns token-form contracts that are not financial instruments. (Wok, art. 1(1)(a); MiFID II, Annex I, Section C; ESMA35-243228190-8148, n. 1.)
Ksa's published assessment guidance states that genuine Wft financial products belong under AFM supervision and treats binary financial products in that setting. That is a material argument for the inflation and EPS branches. The guidance expresses Ksa's competence position; it is not a statutory blanket exclusion or an individual assurance for this platform. The company needs a documented financial classification of the actual rights, execution service and distribution before relying on that position. (Ksa, Leidraad beoordeling kansspelen, sections 3.1–3.2.1.)
Ksa's Polymarket objection decision is the strongest practical warning. Ksa maintained enforcement against an operator that relied on peer-to-peer trading, skill and foreign financial treatment. The decision is an administrative ruling concerning that offer, not a judicial holding that every C(4) or C(10) derivative is gambling. It defeats the proposed assumption that a prediction-market label or foreign regulatory category settles Dutch competence. (Ksa, Adventure One QSS Inc., decision on objection, 23 June 2026, paras. 24–29, 38–43 and 53–61.)
A no-payout forecasting service can fall outside both classifications. The redesign must remove any right to outcome-dependent money or a prize with economic value. Points cannot be redeemed, sold, transferred for value or used to unlock a monetary reward. A fixed subscription for information can be separated from forecast accuracy. Free entry alone is insufficient because Wok's prize-and-chance test does not require a stake. (Wok, art. 1(1)(a); Ksa, Leidraad, sections 4.1–4.2.)
Removing the payout does not exempt separately regulated investment advice. The information product should avoid personalised recommendations about transactions in financial instruments. Its subscription terms should purchase access to forecasts, without creating a financial position or an outcome-dependent reward. (MiFID II, art. 4(1)(4) and Annex I, Section A(5).)
A genuine professional-only financial structure
The proposed licensed first-country route is a Dutch national third-country investment-firm permission. Wft article 2:99b permits an application by a non-EU firm providing investment services only to Annex II Section I professionals or eligible counterparties. It requires the applicable organisational conditions and a representative with an address in the Netherlands. Article 2:99b(3) also imports article 2:99a(2)–(4), including supervisory cooperation, the specified country-status condition and a qualifying tax-information arrangement. The applicant must also demonstrate that the applicable annual-reporting requirement under MiFID II article 41(3) will be met. Those are authorisation conditions, not matters the operator can waive by contract. (Wft, arts. 2:99a(2)–(4) and 2:99b; Stb. 2021, 463, art. I(R)–(S); MiFID II, art. 41(3).)
The application should describe an actual bilateral dealer, with the South African company as contractual principal on every admitted inflation or EPS transaction. Each client requests or accepts that dealer's quote. Clients cannot interact with each other's orders, and the dealer does not operate a client-to-client market behind the screen. Transfers are prohibited except an agreed close-out with the dealer. The firm must request the permissions corresponding to dealing on own account under article 2:99 and any execution service it actually provides under article 2:99b. (MiFID II, Annex I, Section A(2)–(3); Wft, arts. 2:96, 2:99 and 2:99b.)
For this proposed channel, admit only documented per-se professional institutions and separately recognised eligible counterparties. An independent EEA credit institution would hold client money under a documented safeguarding arrangement, outside the original operating pool. Its terms must establish ownership, permitted withdrawals and protection on insolvency. Payments and settlement would use euros; the company would hold no customer crypto keys. Complete the South African derivative permissions and the bank-supported cross-border payment arrangements before launch. The Dutch licence application must include the product terms, client categories, counterparty obligations, custody design, outsourcing and marketing controls. An application or a professional-client acknowledgement permits no trading by itself. (MiFID II, art. 16; Wft, arts. 2:99–2:99b; Financial Markets Act Regulations, 2018, reg. 2.)
AFM's third-country policy requires authorisation unless an applicable exemption or recognised route exists. Its limited country-specific professional exemptions do not provide a South African platform with the asserted launch permission. The national licence provides no automatic right to solicit residents throughout the EU. An actual EEA investment firm with appropriate permissions can instead use the relevant MiFID cross-border procedures, while each destination's product restrictions remain applicable. The proposed first-country structure therefore keeps other EU markets closed. (AFM, Third country policy; AFM, Investment firms, licence application requirements; MiFID II, arts. 34–35.)
A separate exemption can cover a third-country firm whose only activity in the Netherlands is own-account dealing with or through persons permitted under the Wft to provide investment services or deal professionally on own account there. Article 10a is not confined to the countries covered by article 10. Professional-client status alone does not establish the counterparty's required permission. This narrower alternative cannot retain the original client-matching service; any client-execution service also defeats an own-account-only premise. Its separate exclusion for the specified MiFIR article 47(3) branch route must be respected. The proposed licensed channel does not rely on this exemption. (Vrijstellingsregeling Wft, art. 10a, inserted by Stcrt. 2018, 237, art. 5(B); AFM, Investment firms, licence application requirements.)
Multilateral venues and bilateral dealing
Retaining the original financial matching engine requires venue analysis. An MTF brings together multiple third-party buying and selling interests under non-discretionary rules that result in contracts. The operator's automated matching of transferable inflation or earnings positions fits that description on the assumed facts. The financial nature of the contracts and the interaction of orders matter; the company need not take principal risk to operate the venue. (MiFID II, arts. 4(1)(19), 4(1)(22), 18–19 and Annex I, Section A(8).)
An OTF is a separate category for specified non-equity instruments and requires discretionary execution. It is not an alternative name for this automatic order book. An MTF operator cannot simply trade against its own venue users as principal, while OTF matched-principal trading has separate limits. Inserting the company between pre-matched customers also does not, by itself, prove a genuinely single-dealer system. (MiFID II, arts. 4(1)(23), 19(5) and 20.)
A company determined to preserve multilateral trading should use an appropriately authorised EEA venue structure with real management and control. The operator must obtain the specific MTF permission and discharge venue obligations. An EEA subsidiary that merely fronts for an uncontrolled South African engine would not satisfy the proposed structure. Outsourcing critical technology leaves the authorised firm responsible for its regulated business. (MiFID II, arts. 16(5), 18–19 and Annex I, Section A(8).)
Professional status and continuing conduct duties
An experienced bettor is not necessarily a professional client. Per-se categories include regulated financial institutions and qualifying large undertakings. For a large undertaking, Annex II requires two of three thresholds: balance sheet total of €20 million, net turnover of €40 million and own funds of €2 million. Classification must attach to the actual contracting customer, not an affiliate or the person operating its account. (MiFID II, Annex II, Section I.)
Elective professional treatment requires an adequate expertise assessment and at least two specified criteria. Those concern transactions of significant size on the relevant market averaging ten per quarter over the previous four quarters, a financial-instrument portfolio exceeding €500,000 including cash deposits, and at least one year in a financial-sector professional role requiring knowledge of the envisaged transactions or services. The firm must obtain the written request, warning about lost protections and separate acknowledgement prescribed by Annex II. Wealth alone, a tick box or manufactured trading history cannot satisfy that process. (MiFID II, Annex II, Section II.)
Elective professionals may fall outside a retail-only product prohibition after valid classification, but they are excluded from the proposed article 2:99b channel. Article 2:99a requires the different Dutch branch route for services to retail clients or Annex II Section II professionals. That distinction prevents the operator from advertising to retail users and converting them into purportedly eligible customers at checkout. (Wft, arts. 2:99a(1) and 2:99b(1); AFM, Verbod op binaire opties, arts. 1–2.)
Eligible-counterparty status is also distinct from professional status. MiFID article 30 limits its differentiated treatment to specified transaction services and counterparties. Product approval and target-market duties ordinarily continue for professional distribution. Article 16a exempts specified product-governance requirements when financial instruments are marketed or distributed exclusively to eligible counterparties. That limited exemption does not remove authorisation, asset protection or the fair-dealing requirements that remain applicable. (MiFID II, arts. 16(3), 16a, 24(2)–(3) and 30.)
The product file should identify permitted clients, loss capacity, the intended use, pricing and oracle failure. It should document negative target markets, distribution restrictions and review triggers. Marketing must fairly explain the binary loss, fees and counterparty risk. A South African campaign directed at Dutch clients cannot be converted into reverse solicitation through a contractual declaration. AFM's initiative test excludes services promoted or offered by the foreign firm to Dutch clients. (MiFID II, arts. 16(3) and 24(2)–(3); AFM, Initiative test.)
Dutch gambling licensing and territorial reach
A Dutch remote-gambling permission covers the categories authorised under Wok and Bkoa. The permitted betting categories concern sports results or events during sports competitions and horse racing. Inflation releases and corporate earnings are outside those categories when offered as bets. Ksa applied that distinction in its Polymarket decision; possessing a sports-betting licence would not authorise an unrestricted economic-event catalogue. (Wok, arts. 31 and 31a; Bkoa, art. 2.1; Ksa, decision on objection, 23 June 2026, paras. 38–43.)
The ordinary applicant-establishment rule and the statutory conditions for an exception also matter. A South African company cannot presume its foreign incorporation qualifies it for Dutch remote licensing. A suitable EEA establishment or an applicable non-EEA exception must be established, together with the actual licence requirements. The Dutch gambling interface also faces restrictions on offering unrelated goods and services. A combined finance-and-betting lobby needs more than separate labels in one menu. (Wok, art. 31g; Bkoa, arts. 3.1 and 4.2.)
A licensed sports service must verify player identity and check the central exclusion register before admission, subject to the statutory technical-failure procedure. Bkoa restricts payment instruments to those issued by qualifying EEA credit institutions or payment-service providers and traceable to the player. Player-account and counterpart-account requirements prevent the original pooled wallet from being treated as an approved cashier. The gaming system must undergo the prescribed certification before use. (Bkoa, arts. 4.16, 4.18, 4.25–4.30 and 4.50.)
Ksa also states in its June 2026 decision that cryptocurrencies are excluded at licensed online-gambling operators. The proposed crypto cashier therefore faces a gambling-specific obstacle independent of MiCA permissions. A later licensed sports structure should use a compliant fiat cashier rather than assume token-provider authorisation resolves that objection. (Ksa, decision on objection, 23 June 2026, para. 33; Bkoa, art. 4.25.)
Offshore hosting and the absence of Dutch advertising do not remove territorial exposure. On 22 April 2026, the Administrative Jurisdiction Division of the Council of State held that active targeting was unnecessary. It assessed objective features, including access from a Dutch IP address and the ability to use euros. A foreign operator cannot leave the service available on those terms and rely only on a statement that Dutch users are unwelcome. (ABRvS 22 April 2026, ECLI:NL:RVS:2026:2302, paras. 5.1–5.4.)
Ksa's June 2026 objection decision likewise maintained responsibility where the operator controlled the customer-facing offer despite external technical components. Neither user-to-user contracting nor a decentralised settlement description automatically displaces the organiser. The practical consequence is to stop access and solicitation, rather than wait for a particular payment processor or oracle to receive an enforcement notice. (Ksa, decision on objection, 23 June 2026, paras. 47–61.)
MiCA and the payment or token layer
A financial event instrument is excluded from MiCA under article 2(4)(a), even when issued or transferred on a blockchain. Its custody and trading must be assessed under financial-services law. A separate stablecoin used for funding is a different asset. A token referencing one official currency can be an e-money token; a token referencing other values or combinations can require the asset-referenced-token analysis. A contingent €1-or-zero event right does not become a stablecoin merely because its winning payment is fixed. (MiCA, arts. 2(4)(a) and 3(1)(5)–(7).)
For a nonfinancial event token, MiCA may apply if it is a digitally represented right or value capable of electronic transfer and storage using distributed-ledger or similar technology. The actual offer, trading and custody services must then be classified. MiCA's application does not legalise the underlying gambling offer. Conversely, a gambling licence does not supply permission to run an unrelated crypto-asset exchange or custodial service. (MiCA, arts. 2–3 and 59; Wok, art. 1(1)(a); ESMA35-243228190-8148, n. 1.)
Receiving a token as payment is not, by itself, proof that every CASP category applies. Controlling customers' private keys, exchanging their tokens or transferring tokens on their behalf can establish separately regulated services. An EU CASP authorisation requires the prescribed establishment and organisational conditions. Article 60 permits certain already regulated financial entities to provide equivalent crypto-asset services after the required notification; it does not grant a CASP the reverse right to conduct investment business. (MiCA, arts. 3(1)(16)–(26), 59–60.)
Payment-services permission can also be required. MiCA article 70(4) requires the CASP or its payment partner to hold the relevant payment-services authorisation. DNB distinguishes customer EMT transfers and certain third-party-capable custodial wallets from exchange activities that do not themselves constitute payment services. A new platform should not rely on historic transitional tolerance for an October 2026 launch. The proposed institutional launch uses euros and regulated payment providers instead of operating a customer stablecoin wallet. (MiCA, art. 70(4); DNB, Licence application for CASPs, 20 November 2025.)
ESMA's 8 October 2026 opinion also addresses services involving non-MiCA-compliant ARTs and EMTs. It expects CASPs to prevent new or increased client exposure, including through custody and transfers, while permitting limited handling of existing holdings for orderly exit or safekeeping. This is supervisory interpretation of MiCA article 66(1), addressed primarily to national authorities, rather than new legislation. Its remedial timetable does not authorise a new stablecoin-funded launch. (ESMA75-113276571-1742, paras. 9, 11–14 and 21–28.)
Token and provider checks can start with Licentium's MiCA register hub, followed by the relevant official register and the exact permitted service scope. Neither a register listing nor the existence of a white paper proves permission to offer the event contract. The operator must keep instrument authorisation, custody permission and gambling permission separate. (MiCA, arts. 2(4)(a), 59–60; Wok, art. 1.)
South African financial and gambling requirements
South African law governs the business operated there even when its proposed customers are overseas. The operator must distinguish genuine derivatives activity from betting before selecting a permission. Under the Financial Markets Act, a derivative can relate to an underlying rate, index or measure of economic value. The specified inflation and EPS rights fit that financial inquiry; a simple football result has no equivalent economic-measure premise merely because users trade its price. (Financial Markets Act 19 of 2012 (FMA), s. 1.)
Section 3(2) supplies an express priority rule: gambling or wagering law does not apply to an activity regulated by or under the FMA. That provision materially strengthens the financial branch in South Africa. It requires actual FMA-regulated activity, rather than a company's assertion that all predictions are derivatives. FAIS treatment of a crypto-asset as a financial product is not identical to regulation of the underlying activity under the FMA. The football branch cannot borrow the exclusion from an adjacent inflation market. (FMA, s. 3(2); FSCA, GN 1350 of 2022, clauses 1–2.)
The 2018 FMA Regulations require authorisation for an OTC derivative provider. The definition addresses regular principal issuance, origination or sale of OTC derivatives and market-making. A company that becomes contractual principal in the proposed institutional channel must satisfy that requirement before acting or holding itself out as an ODP. Pure matching as agent is not automatically principal issuance, but a securities marketplace can instead require exchange licensing under FMA sections 7 and 9. (Financial Markets Act Regulations, 2018, GN 98, GG 41433, regs. 1–2; FMA, ss. 7 and 9.)
Advice or intermediary services in financial products require the appropriate FAIS permission. Financial-product definitions include derivatives; the FSCA's 2022 declaration separately brings qualifying crypto-assets within FAIS. An FSP licence must cover the actual activity and product category. It does not replace ODP or exchange permission. These South African permissions also provide no Dutch market access by themselves. (Financial Advisory and Intermediary Services Act 37 of 2002, ss. 1, 7–8 and 12(2); FSCA, GN 1350 of 2022.)
For the gambling branch, the National Gambling Act expressly covers staking or accepting stakes with another person on a contingency. That wording reaches beyond the traditional house-banked bet and requires examination of this peer-to-peer model. The distinction between betting and an interactive gambling game also matters: section 5 excludes specified bets from its gambling-game definition. The National Gambling Board distinguishes licensed online betting from prohibited interactive gambling. An assertion that every form of online gambling is lawful, or that every online bet is prohibited, would erase that statutory distinction. (National Gambling Act 7 of 2004 (NGA), ss. 4–5 and 11; National Gambling Board, FAQs.)
The sports business needs permission under the applicable provincial regime for its actual premises, operator and betting model. National supervision does not replace provincial licensing. The application must address accepting overseas business and the proposed matching and settlement system. Excluding South African customers is not a statutory permission to operate an unlicensed betting business from South Africa. The uncommenced 2008 interactive-gambling amendments provide no substitute authorisation. (NGA, ss. 8, 11 and 30–31; South African Government, National Gambling Amendment Act 10 of 2008, official commencement record.)
South African exchange control and the fiat-only structure
The operator must establish lawful payment routes separately from its financial or gambling permission. The Exchange Control Regulations restrict unauthorised foreign-exchange dealings and specified cross-border payments or capital exports. Treasury permissions implemented through authorised dealers and the applicable manual determine which transactions a bank can process. The company's flows cannot be justified by allowances granted to private individuals. (Exchange Control Regulations, 1961, regs. 2–3 and 10(1)(c); SARB, Financial Surveillance FAQs, applications and permissions through authorised dealers.)
Before accepting institutional funds, the company should give its authorised dealer a transaction map. It must distinguish client collateral, trading proceeds, fees, overseas custody, hedging payments and capital used to fund a subsidiary. Each flow needs the applicable permission, reporting treatment and supporting documents; any transaction outside delegated permissions requires the prescribed referral. A general statement that funds belong to foreign customers does not identify the permission for moving them. (Exchange Control Regulations, regs. 2(1)–(3) and 3; SARB, Financial Surveillance FAQs, applications and permissions through authorised dealers.)
The recommended channel excludes cross-border stablecoin funding, custody and settlement. The August 2026 Treasury and SARB consultation on cross-border crypto-assets describes proposed rules and cannot itself authorise a transfer. A platform must not substitute a wallet movement for a required bank or financial-surveillance permission. Keeping the initial design in fiat does not dispense with exchange control; it makes the actual bank-mediated flows the subject of the approval process. (National Treasury and SARB, joint statement on cross-border crypto-asset transactions, 3 August 2026, pp. 1–3; Exchange Control Regulations, regs. 2–3.)
Contract-specific launch decisions and access controls
For football, select no Dutch cash access and a public no-payout forecast. A professional-only restriction changes none of the gambling licensing elements. A future licensed Dutch sports product would be a separate project with its own permitted operator, betting rules and cashier. The existing hypothetical company has no assumed entitlement to launch it. (Wok, arts. 1 and 31a; Bkoa, art. 2.1.)
For inflation, select the documented institutional permission route under articles 2:99 and 2:99b, as applicable, only after the relevant permissions take effect. Remove multilateral matching for that bilateral design, exclude elective professionals and retain euro settlement. Any retained order book requires its own venue solution. If the actual offer is treated as non-sports gambling, abandon that cash route rather than admit professional bettors. (Wft, arts. 2:99 and 2:99b; MiFID II, art. 4(1)(22); Bkoa, art. 2.1.)
For earnings, select information-only publication initially. A later professional financial instrument can use the authorised institutional channel with separate product approval and information controls. The modelled retail binary must remain unavailable. Replacing €1-or-zero with a different derivative payoff would require a new product analysis; it would not automatically remove MiFID or establish a Dutch retail permission. (MiFID II, arts. 16 and 24 and Annex I, Section C(4); AFM, Verbod op binaire opties, art. 1.)
Hard exclusion should operate at account creation, funding and each order, including API access. Check residence and actual location; reject unresolved country status. Combine verified customer and beneficial-owner information with IP, device and payment-country signals. Block VPN or proxy circumvention where detected, enforce the controls server-side and test them with Dutch-location accounts. A website banner and self-certification alone do not address the objective-access reasoning in the Dutch case law. (ABRvS 22 April 2026, ECLI:NL:RVS:2026:2302, paras. 5.1–5.4.)
Remove Dutch-targeted paid search, affiliates, influencers, app-store campaigns and retargeting for excluded cash products. Do not let a permitted institutional account redistribute access to retail users through an omnibus or white-label arrangement. Reassess client status and investigate inconsistent location or activity. Existing positions require an orderly close-out and lawful repayment process; blocking new activity should not be used as a pretext to retain customer assets. (AFM, Verbod op binaire opties, art. 2; MiFID II, arts. 16(8)–(9), 24(3) and Annex II.)
Public information pages must not become a referral funnel into the prohibited cash service. For crypto-related copy, Atlas marketing-copy screening can provide a first-pass text check before legal approval, but cannot establish client eligibility or permission to market. The release decision belongs to the authorised operator's responsible officers, based on the actual product, audience and jurisdiction. Until that decision is supported by effective permissions, Dutch access to the cash service remains blocked.