Australians warned prediction markets could cost them, with little protection
As Australians engage with billion-dollar prediction markets, betting on anything from war, weather to pop culture, the corporate watchdog is forced to step in.
The Australian corporate watchdog, ASIC, has issued a strong warning about the risks associated with offshore prediction markets. These markets, which are illegal in Australia and unregulated by financial services laws, are proving increasingly popular both domestically and internationally. ASIC has updated its Moneysmart website with guidance and advice, emphasizing that users are likely to lose money without the protections afforded by Australian financial services laws.
Prediction markets allow users to bet on a wide range of future events, from oil prices to global conflicts. While the markets are often marketed as sophisticated financial products, ASIC asserts they are fundamentally speculative bets akin to gambling. ASIC's commissioner, Alan Kirkland, cautions that users engaging with these illegal markets abroad miss out on crucial protections like formal dispute resolution processes and investor oversight.
FEX Global, a financial futures trading house, has proposed what could become Australia's first regulated prediction market, but no formal application for a license has been submitted to ASIC.
Written by urgent.news from ABC News AU's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
