ASIC chair says prediction markets closer to gambling than investing

In short

• ASIC chair Sarah Court told a hearing on 29 October 2026 that prediction markets are closer to gambling than investing.
• No prediction market operator has applied for an Australian licence, and any future application would face strict scrutiny.
• Court likened prediction markets to banned binary options, where users can lose their entire stake on an all-or-nothing outcome.
• Australian users can still access offshore platforms such as Polymarket but get no local dispute resolution or client money protection.

ASIC's warning on prediction markets

Sarah Court, ASIC's chair, told a parliamentary hearing on 29 October 2026 that prediction markets such as Polymarket are more like gambling than investment products, and that no operator in the sector had yet applied for an Australian licence. Polymarket is an offshore platform where users stake money on whether an event will happen, with an all-or-nothing payout; the events are often news headlines unrelated to financial markets. Any later application would be subject to strict scrutiny, according to CoinNess and ChainCatcher. ASIC, Australia's corporate regulator, has also warned that people using offshore prediction markets may find it difficult to secure investor protection under Australian financial rules.

Why binary options matter

Court said the all-or-nothing payoff in prediction markets resembles binary options, which were banned in Australia. In binary options, a person either wins a fixed amount or loses the entire stake based on a yes-or-no outcome. That makes prediction markets difficult to treat as financial products suitable for retail investors, according to ChainCatcher and BlockBeats. Court added that the underlying assets of prediction markets are often unrelated to investments or financial markets.

What Australian users risk

Australian residents can still access offshore prediction market platforms such as Polymarket directly, but they are not protected by local financial regulation. That means no access to dispute resolution or client money protection if something goes wrong, according to BlockBeats. Money magazine has described prediction markets as turning global headlines into betting opportunities and attracting billions of dollars, while ASIC says they are closer to gambling than investing.

Crackdown and social reaction

Australia's authorities have already moved to block access to Polymarket as part of a campaign against illegal online gambling, according to BlockBeats. On X, Detective Pepe (@pepeanalyst) said the ASIC warning leaves Australians who use overseas platforms with no local safeguards and no dispute resolution, while Basedkitty.eth.cast (@Bsedkitty) asked whether clear domestic rules would help or merely drive users offshore. Both posts responded to ASIC's stance.

Strict scrutiny for licence bids

No prediction market operator has applied for an Australian financial services licence so far, and ASIC chair Sarah Court said any future application would be rigorously reviewed. Any operator wanting to enter Australia would need to satisfy a high bar. The central question is whether platforms such as Polymarket will seek a licence or continue operating offshore without Australian oversight.

Questions readers ask

Are prediction markets basically gambling?

ASIC chair Sarah Court said prediction markets such as Polymarket are closer to gambling than to investment products. She compared their all-or-nothing payoff to banned binary options, where users can lose their entire stake, making them unsuitable for retail investors, according to CoinNess and ChainCatcher.

Can Australians access Polymarket?

Australian users can still access offshore prediction market platforms like Polymarket directly, but they have no local financial regulation protections, including no dispute resolution or client money protection, according to BlockBeats.

Has any prediction market operator applied for an Australian licence?

No prediction market operator has applied for an Australian financial services licence so far, ASIC chair Sarah Court told a parliamentary hearing on 29 October 2026. Any future application would face strict scrutiny, according to CoinNess and ChainCatcher.

Our view

At InvestIn.News, we think ASIC is right to view prediction markets as closer to gambling than to investing. The core activity is putting money on the odds of an event happening or not, which is precisely what a wager is.

The all-or-nothing payoff that Sarah Court compared to banned binary options reinforces the point. A user can lose the entire stake on a yes-or-no outcome, and the underlying event often has nothing to do with financial markets. Australian users who bypass the block on Polymarket also give up the dispute resolution and client money protections that come with local regulation.

We would revisit this view only if a prediction market operator sought an Australian financial services licence and could show that retail customers genuinely understand and accept the risk. A formal ASIC licensing framework would be the clearest test.

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Keshav Aggarwal