Australia Classifies Retail Prediction Markets as Speculative Bets
Regulators signal strict opposition, equating event-based prediction contracts to prohibited binary options.
1Regulatory Stance on Prediction Markets
The Australian Securities and Investments Commission has officially expressed skepticism regarding retail prediction markets. ASIC Chair Sarah Court stated that these platforms possess all the defining features of a bet rather than a legitimate investment product. The regulator remains unconvinced that such speculative contracts serve the broader public interest in Australia.
2Comparison to Binary Options
ASIC draws a direct parallel between prediction markets and binary options, which were banned for retail clients in 2021. Data from the regulator indicated that up to 77% of retail participants lost money using binary options. Consequently, the ban on these products has been extended by the authorities until October 2031.
3Questioning Investment Legitimacy
The regulator highlighted that many events underlying these markets, such as weather forecasts or sports outcomes, lack any connection to traditional investment activities. These speculative features raise significant concerns about whether such contracts should be marketed as financial products. ASIC maintains that these activities are fundamentally different from regulated market instruments.
4Market Integrity and Risks
ASIC identified several critical risks associated with prediction markets, including potential market manipulation and the misuse of confidential information. The regulator also cited concerns regarding disputes over how specific outcomes are determined. Under section 798A of the Corporations Act 2001, these factors complicate the approval process for any potential market license.
5Current Licensing Status
As of late October 2026, no prediction market operator has formally applied for an Australian market license. ASIC confirmed that any future application would face a high regulatory bar. The commission’s consumer site, Moneysmart, explicitly warns that no prediction market is currently licensed as a financial market within the country.
6Offshore Platform Restrictions
Australians utilizing offshore prediction platforms operate without any protections under local law. ASIC reminded financial services licensees that their existing obligations remain fully applicable even when facilitating access to these sites. Notably, the Australian Communications and Media Authority blocked Polymarket in August 2025, classifying it as an illegal gambling service.
7Global Regulatory Divergence
The approach in Australia aligns with restrictive stances seen in parts of Europe and the U.K. regarding event contracts. Conversely, Gibraltar has recently established a dedicated regulatory regime for these markets. This global split persists even as major industry players continue to secure significant capital, such as Kalshi’s recent valuation.
8Broader Implications for Operators
The Australian regulatory environment remains hostile toward speculative event-based wagering. Beyond financial markets, this trend extends to digital entertainment, as seen with Rockstar disabling casino wagering in GTA Online for Australian players. Operators seeking entry into this jurisdiction must navigate strict interpretations of gambling laws and high consumer protection standards.
Original article: Bitcoin News — Australia Classifies Retail Prediction Markets as Speculative Bets