ASIC Scrutinizes Retail Prediction Markets in Australia, Citing Public Interest and Market Integrity Risks
Australia’s financial regulator, the Australian Securities and Investments Commission (ASIC), has publicly questioned whether retail prediction markets serve the public interest. In a formal statement released by Deputy Chair Sarah Court, the regulator warned that many prediction market contracts often featuring binary, all-or-nothing payouts tied to non-traditional outcomes like sporting events or weather forecasts carry "all the features of a bet" and present elevated risks to market integrity.
While ASIC clarified that its position does not introduce a new prohibition or decide any pending licence applications, it sets a formidable regulatory hurdle for prospective operators. Under Section 798A of the Corporations Act 2001, ASIC must evaluate the public interest when considering market licences; as of August 3, 2026, zero prediction market operators hold an Australian financial market licence. Drawing direct parallels to binary options which ASIC banned for retail users in 2021 through an order extended until October 2031 the regulator highlighted vulnerabilities regarding insider trading, market manipulation, and contractual disputes over outcome determination.
The position statement also reinforces regulatory friction for offshore prediction platforms. Australians accessing unlicensed overseas exchanges operate outside domestic investor protections. Major platforms like Kalshi already classify Australia as a restricted jurisdiction, while the Australian Communications and Media Authority (ACMA) blocked access to Polymarket after deeming it a prohibited interactive gambling service. Operators seeking entry into the Australian market will face strict regulatory oversight to prove public interest compliance and mitigate integrity risks.
