Australian regulators scrutinize US prediction platforms offering markets on local political events

Australian regulators are monitoring US-based prediction market platforms that are hosting bets on Australian elections, Reserve Bank decisions, and specific words Prime Minister Anthony Albanese may say in Parliament.

The platforms, including Kalshi and Polymarket, allow users to buy shares in contracts tied to the outcome of events. They are not approved by Australian regulators and do not allow Australian users, but experts say access is possible through VPNs.

The Australian Securities and Investments Commission (ACMA) said prediction markets are “high-risk and speculative and pose a significant risk to retail investors,” noting that no such provider holds an Australian market license, reports The Guardian.

The ACMA has already ordered Australian internet service providers to block Polymarket after finding it was offering gambling services without a valid license. ACMA said it was monitoring prediction market services and noted that Kalshi had geoblocked Australian users.

Despite the restrictions, both platforms have hosted Australian markets. Polymarket recorded nearly US$500,000 in trading on the winner of the Farrer byelection, while Kalshi recorded US$98,572 on the same contest.

Kalshi has also listed markets on Australia’s May unemployment rate, the next Australian House election and the Reserve Bank’s June cash rate decision. Polymarket has hosted markets on RBA decisions and whether Albanese would be out as prime minister by June or December.

Earlier this month, Kalshi hosted a market on which individual words Albanese would say during question time. The contracts drew US$13,000 in trading and covered words including “Iran,” “TAFE,” “Trump,” “tax cuts”, and “healthcare.”

Kai Cantwell, CEO of Responsible Wagering Australia, said Australians were already seeking out these products through offshore operators outside local laws and consumer protections. Cantwell also warned that the platforms raised integrity risks because markets could be manipulated where transparency and oversight were limited.

Martin Thomas, chief executive of the Alliance for Gambling Reform, said prediction markets could become a new online gambling challenge for Australia.

“We’re concerned about it. I think it will be part of this next wave [of gambling] to hit Australia, which will have a deep impact, and which regulators and policymakers will be way behind on,” Thomas said. He said the platforms appeared to fall into a regulatory loophole and warned that the government’s forthcoming wagering reforms may not adequately cover them.

A government spokesperson said the planned reforms would expand ACMA’s powers to block illegal gambling websites, expand existing advertising bans and block transactions to prohibited gambling operators.

A Kalshi spokesperson told The Guardian it had “no trading” in Australia and that trading was prohibited for residents of more than 50 countries, including Australia. The company said it had “no current plans” to seek approval to operate in the country.