Australia’s corporate regulator says it is “not currently convinced that prediction markets for retail clients are in the public interest”, in a statement attributed to Chair Sarah Court published on Friday 30 October. The Australian Securities and Investments Commission (ASIC) stated a doubt. It imposed no ban.
The statement, media release 26-261MR, says prediction market contracts “have all the features of a bet” and sets them beside binary options, which are prohibited for retail clients in Australia. Its examples are whether it will rain tomorrow and who wins a sports match or by how many goals, events it says often have “nothing to do with investment”. It questions whether the contracts are properly called investment products at all. It names no platform, does not mention crypto, and announces no rule, consultation or enforcement action.
A day earlier, on Thursday 29 October, Court told a Senate estimates hearing that no prediction market operator had applied to ASIC, that an application would let the regulator test whether a platform is suitable, and that any bid would face a high bar. Those remarks reach us second-hand: Finance Magnates relayed them from Bloomberg, with no direct quotation, and Coindaro has not seen the Hansard record.
ASIC prediction markets position: doubt, not a prohibition
In Australia the public interest test applies at the licensing stage. A background note to the release says section 798A of the Corporations Act 2001 requires ASIC to have regard to whether granting an Australian market licence would be in the public interest. Saying it is not convinced tells any future applicant where the regulator stands today. By Court’s account nobody has applied, so ASIC has refused nothing, and “currently” leaves room for a change of view.
ASIC also lists market integrity risks, among them misuse of confidential information, market manipulation and disputes over how outcomes are determined. American readers will know the first one. US senators gave Kalshi and Polymarket until 3 November to count suspected cases of insider trading or manipulation on election contracts.
Without a licence, platforms are more likely to face gambling rules than financial ones, according to Bloomberg as relayed by Finance Magnates. Polymarket has already met that route. The Australian Communications and Media Authority listed it on 13 August 2025 among sites blocked by internet providers, after investigations found breaches of the Interactive Gambling Act 2001.
Why ASIC compares event contracts to banned binary options
Both products involve speculating on the binary outcome of a future event, the background note says. The difference it draws is the channel: prediction market contracts generally come through a market platform, while binary options are sold over the counter by brokers. Our guide to how prediction markets work walks through the mechanics.
The comparison carries weight because ASIC has already acted on one of the two. It banned the sale of binary options to retail clients from 3 May 2021, then in September 2022 extended the ban to 1 October 2031. Friday’s note says this followed data showing “up to 77%” of retail clients lost $14 million in the last year before the ban. That sentence joins two measures which the 2022 release gives separately, so the table keeps them apart.
| ASIC figure on binary options | Value, as printed by ASIC | Who is counted | Period |
|---|---|---|---|
| Retail clients who lost money | about 80% | Retail clients | ASIC reviews of 2017 and 2019 |
| Net losses, ASIC estimate from gross trading revenue | about $490 million | Clients in Australia and offshore of five licensed providers | 2018 |
| Net losses, ASIC estimate, likely understated | more than $6.7 million | Australian retail clients only | 2019 (12 months to 30 November 2019) |
| Active retail clients who lost money | 74% to 77% | Active retail clients | Each quarter, April 2020 to 3 May 2021 |
| Aggregate net losses | $14 million | Retail client accounts | 13 months to 3 May 2021 |
These are different periods and different groups of people, so they should not be added or read as a trend. The 2018 estimate covers clients in Australia and offshore, and ASIC derived it from the five providers’ reported revenue. The 2019 figure counts Australians only, for the 12 months to 30 November 2019 in ASIC’s impact statement, and ASIC says it probably understates losses. In between, providers stopped serving many foreign clients after an ASIC warning in April 2019, and their retail clients fell from over 280,000 to under 12,000.
The dollar signs are ASIC’s own. Neither release, nor the 2021 notice, names a currency for these amounts. Australian dollars is the natural reading for an Australian regulator, but it is our reading and not ASIC’s wording, so we have not added an A$ label.
All of this concerns binary options. ASIC gives no loss figure for prediction markets in this statement, and its Moneysmart page cites a further number for binary options, around 75% of retail clients losing money, without giving the period.
Offshore prediction markets: no Australian protection for direct users
Australians who go directly to offshore prediction markets have no protections under Australian law, the statement warns. Moneysmart, in a page last updated on 3 August 2026, names two of the things they lose: internal dispute resolution and client money safeguards. It says no prediction markets are currently licensed as financial markets in Australia, and tells readers to check whether a platform is on the ACMA list of blocked gambling sites.
The statement also addresses Australian financial services licensees who facilitate access to those venues. All their licence obligations continue to apply to that activity. That line is aimed at intermediaries, the firms already inside ASIC’s licensing system.
Other regulators are splitting on the same contracts
ASIC says its approach matches several comparable jurisdictions, including parts of Europe and the UK, where regulators have restricted access to event contracts resembling binary options. Finance Magnates reports that the European Securities and Markets Authority (ESMA) said in July that such contracts can fall under its retail binary options ban whatever they are called. Bitcoin.com adds that Gibraltar created a dedicated regime for prediction markets the same month, a different route. Coindaro has not checked either point at the primary source.
In the United States the contracts trade on exchanges overseen by the Commodity Futures Trading Commission (CFTC), a model state gaming regulators contest, Finance Magnates notes. Utah filed criminal charges against Kalshi and its founders in a document dated 28 October. On 29 October, the day of Court’s Senate appearance, Kalshi said it had raised $1 billion at a $40 billion valuation. Finance Magnates cites FM Intelligence for taker volume across Kalshi, Polymarket and Polymarket’s US venue of $172.4 billion in the third quarter, up from $98.5 billion in the second.
Crypto is part of that business. Crypto event contracts on Kalshi and Polymarket reached a reported $2.7 billion of notional volume in a single week, per a Bloomberg newsletter of 22 October. Polymarket’s documentation describes its collateral as pUSD, a USDC-backed token on Polygon. ASIC’s statement does not address crypto settlement.
What is still unknown
ASIC has not said whether it plans a formal measure or a consultation. Nothing we found shows a response from Kalshi or Polymarket to the statement. The exact words Court used at estimates remain unconfirmed until the Hansard transcript can be read. The next concrete test would be an operator filing a licence application, and none has been reported.