Australia’s ASIC Questions Public Interest of Retail Prediction Markets

Australia’s securities regulator has questioned whether retail prediction markets serve the public interest, saying their all-or-nothing contracts can resemble bets and raise risks for market integrity.

The Australian Securities and Investments Commission (ASIC) said prediction contracts can cover events with little connection to investing, including tomorrow’s weather or a sports result. ASIC Chair Sarah Court said, “Prediction market contracts have all the features of a bet.”

ASIC also raised concerns about the use of confidential information, market manipulation and disputes over how contract outcomes are determined. The statement sets out the regulator’s view; it does not impose a new ban or decide a license application.

Under section 798A of the Corporations Act 2001, ASIC must consider the public interest when deciding whether to grant an Australian market license. No prediction market operators held licenses as financial markets in Australia as of Aug. 3, 2026.

ASIC compared prediction markets with binary options because both involve speculation on a binary future outcome and can have all-or-nothing results. Their structures differ: prediction markets generally operate through platforms, while binary options are sold over the counter through brokers.

ASIC banned the issue and distribution of binary options to retail clients in 2021. The order took effect May 3, 2021, and was extended through Oct. 1, 2031. That order applies to binary options; ASIC’s current statement does not extend it to prediction markets.

The written statement follows Court’s earlier appearance before senators on prediction markets. Australians who access offshore prediction markets directly online lack protections under Australian financial-services law. Australian financial-services licensees that facilitate access remain subject to their Australian license obligations.