Prediction Markets Rise in Australia Gambling Debate

Money is beginning to circulate through an unusual new segment of online wagering, where participants are not only betting on elections or interest rates, but also on whether the Australian Prime Minister will say specific words during parliamentary sessions.

One recent contract asked traders to forecast whether Anthony Albanese would reference terms such as Iran, Trump, TAFE or tax cuts during question time. That single market recorded around US$13,000 in trading activity.

The contracts were listed on Kalshi, a US-based prediction trading platform that has been expanding rapidly into areas covering politics, economics, sport and cultural events. Its competitor, Polymarket, has also seen significant activity linked to Australian outcomes, even though neither platform is licensed to operate locally.

Polymarket users have reportedly traded close to US$500,000 on markets tied to the Farrer by-election, while Kalshi recorded nearly US$100,000 on the same contest. Other contracts have focused on Reserve Bank of Australia decisions, unemployment data and whether Albanese would remain in office through the end of the year.

A new form of wagering

At first glance, these platforms resemble financial exchanges more than traditional betting sites. Instead of placing fixed wagers, users buy and sell contracts linked to real-world outcomes, with prices shifting based on demand and sentiment. Operators often present them as trading instruments rather than gambling products.

However, that framing has not eased regulatory concerns.

Martin Thomas from the Alliance for Gambling Reform warned that the rapid rise of these markets in the United States could leave Australian regulators struggling to respond effectively.

The concern extends beyond financial losses. Some markets are extremely narrow, raising questions about potential manipulation when betting is tied to political speech, economic announcements or other sensitive events that are not typically part of regulated gambling products.

Responsible Wagering Australia has also raised concerns about integrity risks and the lack of oversight on offshore platforms operating outside Australian regulation.

Regulatory scrutiny increases

The Australian Communications and Media Authority previously took action against Polymarket, instructing internet service providers to block access after classifying it as unlicensed gambling.

Kalshi has also restricted access for Australian users and states that Australians are not permitted to trade on its platform. The company says it does not operate in Australia and has no plans to seek local approval.

Despite these measures, regulators acknowledge that enforcement is not straightforward. Virtual private networks can bypass geographic restrictions, reducing the effectiveness of blocking tools.

The Australian Securities and Investments Commission has likewise been tracking the growth of prediction markets in the US, viewing them as high-risk speculative products. No operator currently holds a licence to offer such services in Australia.

Regulatory framework still evolving

Upcoming wagering reforms are expected to strengthen enforcement powers, including improved tools to block illegal gambling platforms and restrict payments to prohibited operators. Whether these measures will be effective against prediction markets remains uncertain.

The challenge for regulators lies in classification. These platforms operate in a grey area between financial trading and gambling, adopting exchange-style mechanics while functioning in practice like betting markets.

As a result, an expanding range of outcomes is being turned into tradable contracts from elections and interest rates to entertainment releases, weather patterns and even individual political statements made in parliament.