Osasuna Denies Involvement in Kalshi Relegation Prediction Rumors, 'Insurance-ization' Mechanism of Prediction Markets Draws Regulatory Scrutiny

Odaily Planet Daily News Spanish football club Club Atlético Osasuna has recently become embroiled in a controversy surrounding prediction market platform Kalshi. Earlier market reports indicated that a Kalshi contract related to the club saw a rapid surge in trading volume, reaching approximately $591,600. The market predicted the club might be relegated from La Liga in the 2025–2026 season, sparking speculation that the club might be using 'reverse betting' to hedge against the revenue risk of relegation.

In response, Osasuna publicly denied any direct involvement in prediction market trading, emphasizing that it has 'never placed bets on Kalshi or any similar platform.' The club also confirmed that it had purchased approximately €1.2 million in relegation risk insurance through insurance broker Howden. Kalshi, meanwhile, stated that the event is more akin to the redistribution of traditional insurance risk within prediction markets: the risk hedging is undertaken by the insurance broker, not by the club directly participating in trades, and described the structure as functionally similar to a reinsurance mechanism.

Notably, despite Osasuna losing a crucial match, their rivals failed to overtake them in points, ultimately allowing the club to successfully avoid relegation.

This incident has also sparked discussion about the boundaries of prediction market usage: they are evolving from speculative tools into real-world risk hedging instruments, potentially playing an 'insurance-like' role in sports finance.

Meanwhile, the Spanish Ministry of Consumer Affairs has launched a regulatory investigation into Kalshi and Polymarket, demanding the temporary blocking of these platforms for operating without a license. However, officials emphasized that this action is not directly related to the Osasuna incident. (Fortune)