When it comes to event prediction markets, DraftKings and Fan Duel seem to be taking on the old adage, “If you can’t beat ’em, join ’em.” That’s why earlier this week DraftKings filed an application for membership in the National Futures Association (NFA) and it appears that FanDuel will likely follow suit in short order. It’s a move that makes sense given the free reign that futures market operators seem to have as unregulated sportsbooks and the influence of incoming Commodities Futures Trading Commission (CTFC) Chair and Kalshi Board member Brian Quintenz.
According to a report published on SBC Americas, DraftKings’ futures market operation will be called DraftKings Predict. Though there hasn’t been any official comment from DraftKings on the new operation, the NFA application includes a laundry list of DraftKings executives including CFO Alan Ellingson who is listed at the director and chief operating officer, and company co-founder Paul Liberman who listed as DraftKings Predict’s director and CEO.
The emergence of predictions markets as direct competition to regulated sportsbooks is an issue that’s been on the radar of major gaming operators for quite some time. Just last month DraftKings CEO Jason Robins told investors, “In the next couple of months, 60 days or so, there’s going to be a CFTC ruling and all sorts of other things. So, I think we’ll know a lot more over the next few months.”
On the FanDuel side, Flutter CEO Peter Jackson recently said that while there are some opportunities in prediction markets, he thought that that side of the business lacked the richness of traditional sports betting.
Given the potential entry of DraftKings into the market, it’s likely that a flood of regulated operators are considering the same move.