- CEO Peter Jackson confirmed FanDuel is exploring entry into the U.S. prediction markets
- Jackson made the comments during the company’s Q1 earnings call
- Interesting prospect for FanDuel in state’s with no legalized sports betting
FanDuel is considering potential entry into the U.S. prediction markets.
FanDuel CEO Peter Jackson yesterday said the company is “closely monitoring” the actions surrounding the U.S. event prediction market and could bring its European betting exchange, Betfair, to the U.S.
“It’s worth reminding, we do operate the world’s largest sports betting exchange. We know this space well. The Betfair Exchange has for many years given us very good insights in terms of how this stuff can play out,” he said.
Prediction Markets May Offer New Opportunities
The Betfair Exchange, which is the world’s largest sports betting exchange, provides a similar product that is currently offered by Kalshi, Crypto.com, and Robinhood in the U.S.
The betting exchange could serve as a way to “prime the pump” in states that do not currently have legalized sports betting, Jackson said.
“Clearly, in states that haven’t regulated, there’s a sort of prime the pump type of opportunity that is not that dissimilar to some of the DFS (daily fantasy sports) stuff, albeit it’s worth remembering that DFS is a really good precursor to the parlay product, whereas the prediction markets are quite limited. So look, we’re interested in the potential opportunity,” Jackson noted.
FanDuel has already started to prepare for such an eventuality, Jackson said, transferring employees with experience in building out these types of products and services from the Betfair Exchange to evaluate the opportunity in the U.S.
Jackson declined to answer a question if FanDuel would attempt to register the exchange with the Commodity Futures Trading Commission (CFTC), which regulates the U.S. prediction markets.
Legal Questions Still Abound
While FanDuel is exploring the possibility of entering the prediction market space, legal questions surrounding the industry are still rampant.
Who exactly regulates these markets? State gaming regulators believe they hold sway over the sports event prediction markets, while brokers such as Kalshi, Robinhood, and Crypto.com believe the CFTC is the only regulatory body with power to limit their services.
Kalshi has filed three lawsuits against New Jersey, Nevada, and Maryland gaming regulators after the state’s ordered the brokerage to cease its sports event prediction markets in their boundaries. Robinhood also filed a similar lawsuit in Maryland.
A number of state gaming regulators have been monitoring the sports event contract market since the likes of Kalshi, Robinhood, and Crypto.com began offering the new prediction markets in late 2024. At least six states have sent cease-and-desist notices to the companies to halt the trading of the sports event contracts, which they believe too closely mirror sports betting.
Several states are also monitoring the situation to see if any action is necessary.
