ASIC questions retail prediction markets and offshore access

Australia’s financial regulator has questioned whether retail prediction markets serve the public interest and warned local financial-services firms that facilitating offshore access does not remove their licence obligations.

The 30 October statement, attributable to Australian Securities and Investments Commission chair Sarah Court, sets out the regulator’s position. It does not announce a new prediction-market prohibition or an enforcement action against a named operator.

ASIC described the contracts as speculative bets on event outcomes and questioned whether investment-product terminology was appropriate. It identified risks involving confidential information, manipulation and disagreements over settlement.

A warning for firms providing access

The statement addresses both Australians using offshore platforms directly and Australian financial-services licensees facilitating access. ASIC warned the former about the absence of Australian-law protections and reminded the latter that their existing obligations continue to apply.

That leaves distribution firms with a separate compliance question from whether an overseas exchange is authorised in its home jurisdiction.

An existing consumer warning

ASIC’s Moneysmart guidance, last updated on 3 August, already said no prediction-market operators were licensed as financial markets in Australia. It warned that users of unlicensed offshore platforms could lack access to client-money safeguards and internal dispute resolution.

The October statement should therefore be read as a further expression of ASIC’s position, with an explicit reminder to intermediaries, rather than the first Australian warning about the products.

The guidance also directs readers to the Australian Communications and Media Authority’s blocked-site information. That is a separate check from financial-market licensing.

Prediction Frontier’s analysis of European prediction-market regulation examines similar distinctions between a platform’s authorisation, the contracts it offers and the countries where customers can access them.