FanDuel has finally confirmed its plans for launching a prediction markets platform, in collaboration with CME Group, one of the largest derivatives marketplaces in the world.
The partnership will see the introduction of FanDuel Predicts, a standalone app that will be rolling out across the United States in December, and which will seek to enter the prediction market fray, going up against the likes of Kalshi.
FanDuel readies prediction app due to arrive in December
Commenting on this opportunity, FanDuel CEO Amy Howe had this to add: "We can’t wait to bring FanDuel's proven approach to product innovation into this dynamic sector. Our partnership with CME Group allows us to leverage their deep market expertise built over decades while delivering the seamless, accessible, and trusted experience our customers expect."
The decision also signals confidence in the future of the sector at a time when gambling regulators and attorneys general all over the country are pushing back against sports prediction markets. FanDuel, though, will not shy away from this challenge and will also launch sports prediction markets of its own.
Among the sports events contracts that will be available are such options as baseball, basketball, football, and hockey. However, the sports event contracts will only be available in states that have not legalized sports gambling, with anyone who is not on tribal land in those states able to trade those contracts.
In other words, FanDuel is still committed to its original view that sports event contracts ought to be regulated the same way as sports gambling once a proper regulatory framework is established.
Although FanDuel is launching sports contracts as a "temporary fix" in a sense, the company will continue to offer other contracts on benchmarks such as the S&P, Nasdaq-100, the prices of oil, gas, gold, cryptocurrencies, and other key economic developments.
Similarly, FanDuel is placing a strong emphasis on responsible use of its upcoming platform, which will encourage customers to "trade responsibly" and make it easy to track information about trading decisions they have made.
The news was naturally welcomed by CEM Group Chairman & CEO Terry Duffy, who was similarly excited about the opportunity this partnership presented:
"Our new event contracts on benchmarks, economic indicators, and now sports will appeal to a new generation of potential participants who are not active in these markets today. This launch will dramatically expand our distribution and reach, connecting directly with FanDuel’s millions of registered U.S. users."
FanDuel and DraftKings exit Nevada sports betting market
FanDuel is not the only company to have explored this space beyond mainstream sportsbooks. DraftKings has long been flirting with the idea and may be galvanized to press ahead with its own platform now that FanDuel is doing the same, not least because of what has just happened in Nevada.
Both companies have confirmed that they are now exiting Nevada, one of America’s largest gambling states, to most likely proceed with plans for the expansion into prediction markets.
Nevada has been one of the most serious critics of prediction markets, and concerns over possibly regulatory issues have prompted the companies to give up their licenses and avoid future headaches with the Nevada Gaming Control Board, the state regulator.
