Prediction market tax
in Australia

If the ATO treats prediction market activity as gambling (not a business), gains are not assessable income. Australia does not tax recreational gambling winnings. No reporting required for the gains themselves.

If USDC is treated as a CGT asset (ATO crypto guidance), each disposal is a CGT event. Short-term (<12 months): taxed at marginal rate. Long-term (≥12 months): 50% CGT discount applies.

The ATO treats cryptocurrency as property: a CGT asset: not as foreign currency. USDC is a stablecoin but classified the same way. Each disposal (converting to AUD, swapping tokens, or spending) triggers a CGT event. Cost base = AUD value at acquisition date.

Because USDC pegs to USD, your cost base and proceeds are both measured in AUD. Even if the USDC value holds steady in USD, AUD/USD movements create a CGT outcome. A 10% AUD depreciation means a 10% gain even if the USD market position was flat.

The ATO requires records of: date of acquisition, cost base in AUD, date of disposal, proceeds in AUD. Koinly (koinly.io/aus) and CoinTracking both support ATO-compatible reports and Polygon network transactions. Keep records for 5 years after the relevant income year.

Capital gains from cryptocurrency are reported on your individual income tax return under "Capital gains or losses." The myTax online form has a dedicated crypto section. You can report gains/losses from Polygon USDC transactions directly. A tax agent familiar with cryptocurrency is advisable for complex situations.