FanDuel Discusses Launching Prediction Markets

Throughout a first-quarter earnings name, Flutter, the mother or father firm of sportsbook FanDuel, mentioned launching prediction markets. 

CEO Peter Jackson states that Flutter is “carefully monitoring” the expansion of prediction markets across the US and will use its Betfair model to enter the prediction market sport within the US: “We’re within the potential alternative, we have now introduced a few of our staff who’ve expertise in constructing these services from the Betfair alternate enterprise and put them into FanDuel to assist us consider the alternatives.”

This shut monitoring might sign an enormous shift within the sports activities playing business throughout the US as books attempt to enter beforehand untapped and profitable markets like California and Texas.

See our FanDuel sportsbook review to learn why we gave them high marks for same-game parlays in addition to payout velocity.

Why Would FanDuel Need To Enter The Prediction Market Area?

Prediction markets equivalent to Kalshi or Polymarket have seen immense development by tapping into US presidential election odds and getting into the sports activities playing world with sports activities occasion contracts.

On the time of writing, Kalshi is seeing an unbelievable $60 million in quantity on a single market; will the Indiana Pacers or the Cleveland Cavaliers win their NBA playoffs sequence?

Kalshi is a federally regulated alternate platform and bypasses state-level gaming rules. Solely the Commodity Futures Buying and selling Fee (CFTC) can determine if Kalshi’s sports activities occasion contracts are authorized, a undeniable fact that has not been misplaced within the authorized system.

The alternate platform has acquired constructive authorized rulings in Nevada and New Jersey, the place district courts agreed that Kalshi falls inside the CFTC’s jurisdiction. It additionally noticed the federal regulator drop an enchantment in D.C., yet one more win for the prediction market operator.

These developments have successfully opened the trail for prediction markets to function legally throughout the US, as long as they’ll obtain a federal license from the CFTC. Seeing Kalshi’s authorized wins, SportTrade has filed for such a federal license, and it appears Flutter could be interested by doing the identical.

Getting Into New Areas

Entering into prediction markets might see Flutter and its FanDuel model enter markets which are presently barred to them. Large markets like California and Texas, the 2 largest states within the union,  have each been immune to permitting authorized sports activities playing.

California voters have routinely voted down constitutional amendments to convey sports activities playing to the Golden State. In 2022, 82% of voters stated “No” to Proposition 27, which might have allowed sportsbooks to accomplice with tribes and function within the state.

In Texas, Lieutenant Governor Dan Patrick has persistently acknowledged that his GOP caucus doesn’t assist legalizing sports activities playing in his state. 

Flutter might get round these restrictions by getting into the prediction market enterprise.