But, prompted by Crikey's reporting, ACMA ruled that Polymarket was in fact a gambling operation, and ordered Australian internet providers to block access to the platform as it didn't abide by Australian gambling regulations. In rejecting its argument that users betting on elections, sports matches, and world events was a form of "prediction markets", Australia thwarted Polymarket's attempt to sidestep gambling regulations.

In the US, Polymarket and its competitor Kalshi have so far successfully argued their platforms aren't for gambling but instead offer a form of derivatives trading, allowing them to operate with lighter regulatory oversight than traditional bookmakers. ACMA wasn't convinced. In its final investigation report, dated June 30 last year, the regulator concluded that Polymarket users "are not engaging with or purchasing financial products" under Australian corporate law.

As Polymarket claims it offers a financial product, it never applied for a commercial gambling licence in Australia. With ACMA ruling it is in fact a gambling operation, Polymarket is in breach of the law which says gambling companies must operate with a proper licence.