Polymarket has relaunched in a limited beta in the U.S., announcing that it is letting a small number of American users trade contracts on outcomes for sports, politics, pop culture, and more.

Founder Shayne Coplan confirmed the news at Cantor Fitzgerald’s Crypto and AI Infrastructure Conference in Miami, calling the U.S. exchange “live and operational.” Bloomberg later reported that the company began onboarding select accounts as part of a compliance-monitored testing phase.

While only a sliver of users currently have access, the relaunch represents a pivotal moment for prediction markets in the U.S.

A Regulated Return After a Rocky Exit

Polymarket’s path back to the U.S. has been anything but smooth.

In 2022, the Commodity Futures Trading Commission (CFTC) fined the company $1.4 million for operating an unregistered event-based derivatives exchange. As part of the settlement, the platform shut off American access and moved operations offshore.

That could’ve been the end of the story. Instead, Polymarket spent the past two years restructuring and working toward a compliant re-entry. The CFTC later issued no-action relief, effectively allowing the company to restart operations through its regulated subsidiaries.

The company’s new architecture gives it the infrastructure to offer event contracts legally within U.S. borders. That means trades on outcomes like “Top Spotify Artist 2025” or “Who will Donald Trump pardon?” can now clear under an approved derivatives framework rather than the gray-area mechanics of offshore crypto markets.

It’s a subtle but significant distinction that could decide how prediction markets evolve in the U.S. over the next few years.

The Competitive Landscape Is Heating Up

Whenever Polymarket does launch (there’s a 94% chance it will happen this year, according to Polymarket), the U.S. prediction market space will look very different.

Kalshi has established a strong foothold as the CFTC’s flagship exchange for event contracts. FanDuel plans to roll out a federally compliant “Predictions” product this winter. DraftKings has confirmed it’s building something similar. Even Trump Media has entered the fray through a partnership with Crypto.com, launching “Truth Predict.”

ProphetX, a sports-first platform, filed for dual CFTC registration as both a Designated Contract Market and Derivatives Clearing Organization, a move that could let it operate nationwide.

By the time Polymarket fully reopens, it will be rejoining an ecosystem that has evolved rapidly. It is now a space where sports and politics are no longer separate verticals but converging pillars of the same prediction economy.

The Road Ahead

Polymarket’s current holdup appears to be a result of the federal government running out of money.

According to a Front Office Sports report, the platform’s long-awaited U.S. relaunch was effectively frozen by the federal shutdown, which began just one day after Polymarket filed its self-certification of event contracts with the CFTC on Sept. 30. The shutdown ended on Wednesday, but it could take some time before everything is operating normally again.

Still, Polymarket appears unfazed. While it rolls out its beta product for testing and approval, the company continues to market aggressively, touting partnerships with Google, Yahoo Finance, PrizePicks and the NHL, and reminding followers that it operates in more than 180 countries. The company’s waitlist still reads “coming soon,” but the debut could happen quickly once the CFTC clock restarts.

FanDuel’s move into prediction markets is official, as Flutter Entertainment, the sports betting operator’s parent company, and CME Group have announced the launch of the FanDuel Predicts app.

Sports event contracts will be offered on the stand-alone app in states where sports betting is not yet legal, according the press release. Sports markets will not be accessible on tribal lands in those states.

The news follows DraftKings, FanDuel’s primary competitor in the regulated sports betting space, announcing just last week that it is set to open a prediction markets platform that will include sports.

FanDuel and CME Group, one of the world’s largest derivatives exchanges, agreed to a partnership back in August. While sports was conspicuously absent from the announcement, it’s never been a secret that sports, specifically in states where sports betting is not legal, is a large part of what they’re after.

Months before the CME Group agreement, Flutter highlighted BetFair, the world’s largest sports betting exchange, as an asset that positioned the company well for a shift into prediction markets.

In addition to sports, typical prediction markets offerings will be available on the app – crypto and commodities’ prices, financial indexes, and key economic indicators. 

Navigating Regulatory Waters: FanDuel, DraftKings Not Welcome in Nevada

For FanDuel and DraftKings, entering prediction markets comes with regulatory risk.

Multiple states have warned their sports betting licensees that they face serious repercussions if they do, including potential revocation of their licenses, contending prediction markets operate as illegal sportsbooks.

In fact, Nevada is now off the table for FanDuel and DraftKings.

FanDuel and CME Group have maintained that the regulatory environment has to be right for them to offer sports event contracts. The launch, though, does seem to skip a step outlined by CME Group CEO Terry Duffy on his company’s Q3 earnings call last month.

“As long as the U.S. government is not going to object to the self-certification of [sports event contracts] and consider these swaps and not gaming, it doesn’t matter what my opinion or anybody else’s,” Duffy said.

“That’s the government’s opinion, and we will proceed accordingly. That is yet to be decided.”

The partners are ostensibly still treading carefully.

From the press release:

“Subject to appropriate regulatory filings, the app will provide access to sports event contracts across baseball, basketball, football, and hockey. In states where online sports betting is not yet legal, customers “who are not on tribal lands will be able to trade event contracts on the outcome of sporting events. As new states legalize online sports betting, FanDuel will cease offering sports event contracts in those states.”

A Smart and Rational Move

Prediction markets put the highly coveted but once untouchable states in play for sportsbooks, and there’s a belief among some industry insiders that regulated states won’t kick out their top sports betting tax revenue producers. Arizona, Pennsylvania, Illinois, New York, and Ohio have made such threats, in addition to Nevada.

In a paper titled, “Calling the Bluff: FanDuel’s Break-Even Analysis for Sports Prediction Markets Entry,” Adam Robinson, an American Bettor’s Voice board member and prediction markets trader, wrote, “These states cannot afford to follow through on their threats.”

“The emergence of sports prediction markets creates massive risk for FanDuel,” Robinson continues. “If they stand down on entering sports prediction markets, they risk missing what may be the biggest shift in the industry since the repeal of PASPA. On the other hand, entering these markets could jeopardize their state-regulated business model.”

On Tuesday, the day before the FanDuel/CME announcement, Robinson told DeFi Rate, “If I’m [DraftKings CEO] Jason Robins, I’m making a rational decision. I’m gonna say the following: ‘Let me go look at states where I’m not gonna monetize for years, if ever. I can put a prediction market business in play there to monetize those states.’

“I view prediction markets for FanDuel and DraftKings as a call option on the future of the industry,” he said. “They have to be in these markets. It’s an existential risk if they’re not, but they don’t have to go all in. They’re going in where there’s no hope of legality any time in a reasonable timeframe for them.”

Kalshi has scored another win in its fight to define the future of sports prediction markets. 

On Monday, a California federal judge refused to block the platform’s contracts, siding with the company’s argument that it is a federally regulated exchange and not a sportsbook. The ruling hands tribes their first loss in a fast-expanding legal battle that could redraw the boundaries of gambling law.

Court Says CFTC, Not Tribes, Regulates Event Contracts

U.S. District Judge Jacqueline Scott Corley rejected a motion for a preliminary injunction from Blue Lake Rancheria, Chicken Ranch Rancheria of Me-Wuk Indians, and Picayune Rancheria of the Chukchansi Indians. The tribes sought to block Kalshi from offering “sports event contracts” accessible from tribal lands, arguing that the operator’s activities violated the Indian Gaming Regulatory Act (IGRA) and constituted unlicensed Class III gaming.

Corley disagreed. In her 28-page order, she ruled that Kalshi’s operations fall under the Commodity Exchange Act (CEA) and the oversight of the Commodity Futures Trading Commission (CFTC).

“The UIGEA, unlike IGRA, expressly addresses internet gaming that can be accessed in locations where such gaming is unlawful, including Indian lands,” Corley wrote, referring to the Unlawful Internet Gambling Enforcement Act (UIGEA). Because Kalshi is registered with the CEA, its online contracts “are not bets or wagers under the UIGEA,” even if users trade them while on tribal property.

Judge Corley is also persuaded by Kalshi's argument that interstate (or in this case, state-to-Indian) gaming issues are governed by UIGEA, not IGRA, and UIGEA carves out trading activity governed by the CEA. pic.twitter.com/n7hdJx5aJw

— Andrew Kim (@akhoya87) November 10, 2025

Expanding Legal Battles

The ruling follows a string of federal victories for Kalshi, which has faced regulatory pressure from states including Maryland, Nevada, and New Jersey. In each case, judges have declined to halt its operations while litigation continues, citing the CFTC’s exclusive jurisdiction over federally registered exchanges.

Still, tribal governments remain central to the fight. Their lawsuits argue that prediction markets siphon revenue from tribal gaming and erode sovereign authority. Earlier this year, a similar challenge helped pause Crypto.com’s event-contract offerings in Nevada.

Judge Acknowledges Tribal Concerns

Corley acknowledged those sovereignty concerns but said they weren’t grounds for a preliminary injunction.

“By self-certifying the legality of its event contracts in a way that insulates its activities from judicial review,” she wrote, “Kalshi may have found a way around prohibitions on interstate gambling that were created with the Tribes’ best interest in mind.”

What the Decision Means for Prediction Markets

While the order is limited to preliminary relief, it reinforces the federal footing Kalshi and similar firms rely on. The court’s reasoning effectively affirms that CFTC-regulated exchanges sit outside state and tribal gambling frameworks, at least for now.

That interpretation narrows the reach of IGRA and state gaming laws in the online prediction-market space, underscoring the jurisdictional gap between traditional gambling regulation and federally registered financial exchanges.

Industry observers say the decision could encourage other platforms to expand their offerings while awaiting further federal guidance.

At the same time, the ruling heightens pressure on the CFTC, which has yet to issue clear rules around sports-based or election-based event contracts. Congress and federal agencies may now face renewed calls to clarify where prediction markets end and gambling begins.

For tribes, the legal route has narrowed but not closed. Their best leverage may now shift from courtroom litigation to legislative advocacy, pushing for clearer boundaries between financial contracts and games of chance.

Ultimately, Corley’s order keeps Kalshi trading, keeps tribes frustrated, and keeps the federal government in charge — at least until the Ninth Circuit or the CFTC decides otherwise.

PrizePicks and Polymarket are teaming up to launch a new prediction markets platform.

The news follows an announcement by PrizePicks in September that its Performance Predictions II subsidiary has secured registration as a Futures Commission Merchant (FCM) by the National Futures Association (NFA), allowing the DFS operator to facilitate trades on futures contracts offered on CFTC-regulated Designated Contract Markets.

The partnership will see Polymarket’s event contracts integrated onto PrizePicks app. The offerings will go beyond sports, according to the press release, which also mentions “entertainment and cultural moments”.

The launch will have to wait for Polymarket’s US re-entry, but that seems imminent, especially with the end of the government shutdown in sight.

“As Polymarket prepares for its anticipated re-entry into the U.S. market,” the press release says, “this collaboration further strengthens its mission to make prediction markets accessible and trusted at a global scale.”

Partnerships Expanding Quickly Across the US

The PrizePicks/Polymarket tie-up is the most recent in a lengthening list of deals as sports betting companies seek a slice of the prediction markets pie.

Underdog, a major competitor of PrizePicks in the fantasy pick ‘em space, partners with Crypto.com to offer sports event contracts in 16 states.

Last week, DraftKings, fresh off its acquisition of CFTC-approved Railbird Exchange, unveiled plans to launch a prediction markets platform that will include sports event contracts.

FanDuel, meanwhile, is teaming up with CME Group, but both partners maintain they need the right regulatory environment to move forward with sports event contracts.

Convergence of Prediction Markets and Sportsbooks

PrizePicks CEO Mike Ybarra discussed the Polymarket deal on Squawk Box today and was asked by CNBC’s Andrew Ross Sorkin about the convergence of sports betting and prediction markets.

“I think it complements our business very well,” Ybarra responded. “I don’t think it’s one takes over the other. This is about expanding the number of customers that we have for our product, but also enabling us to enter new states … and welcome millions more people into the PrizePicks environment.”

Ybarra also explained the disputable notion that “prediction markets is peer to peer” as a key distinction between prediction markets and sportsbooks.

“In online sports betting, those operators create the lines, and they build in profit into those lines. You’re playing against the house,” he said. “Prediction markets is peer to peer, and what that means is it’s supply and demand. Is it A or is it B? There is no against-the-house market there, and I think that’s very important to understand.”

Sorkin dug deeper, asking if M&A between sports betting sites and prediction markets will eventually mean consolidation to two or three major platforms.

“From the customer experience, it may actually not be that different whether you’re betting against the house, per se, versus betting on those markets,” Sorkin probed.

“I think you’re going to see a lot of new players in the market, and the more competition that comes in the United States, frankly, the more innovation and the more customer value you’ll see,” Ybarra said. “At PrizePicks, it’s important for us to have a single-app experience across daily fantasy sports and prediction markets, but we welcome the competition. We hope that a lot of new people come in, and it’ll push us to innovate more and frankly drive a lot more customer value.”

While a bill has been filed in the New York State Assembly to restrict prediction markets on multiple fronts, Senator Joseph Addabbo’s support is critical to its passage.

Assemblyman Clyde Vanel went it alone in introducing NY AB 9251 on Friday, Nov. 7. The legislation does not yet have a co-sponsor in the Senate.

As Chair of the Senate’s Racing, Gaming & Wagering Committee, Addabbo has championed pro-gambling legislation in New York, and he wants the state to be proactive in dealing with prediction markets.

“I’m glad to see my friend Clyde Vanel introduced this. We could have waited on the sidelines to see what the CFTC would do,” Addabbo told DeFi Rate over the phone on Monday. “I don’t do that. I don’t like to wait on the sidelines.”

Prediction Markets Bill Needs NY State Senate Co-Sponsor

Addabbo had already been consulting with attorneys about how the state can protect itself and its residents from prediction markets.

He told us last month that while he prefers further regulation at the federal level, he’s been planning on firing up the discussion when the new legislative session begins in January.

Vanel’s bill, though, hastens those conversations.

“We were talking to our legal counsel to see what can be done,” Addabbo said this week, “and now that this bill came out, I will ask my legal counsel to look at it.”

“It does need a Senate sponsor. If we feel it’s something that’s A) within our jurisdiction and B) it would matter — like it would make some sense to do – I’ll talk to my friend [Assemblyman Vanel] to see if I can carry it in the Senate.”

How Does NY Bill Address Prediction Markets?

The sports event contracts prediction markets offer are central to the legal, and now legislative action states are taking against these companies, Kalshi first and foremost. The contracts are indistinguishable from sports bets, states claim, meaning prediction markets are illegally circumventing state regulation and taxation.

NY AB 9251 would ban prediction markets from offering “athletic market events”, including horse racing and prop bets.

As outlined by Daniel Wallach on X, the bill would also:

• Ban market makers, which provide most of the liquidity on prediction markets and are often institutional, not peers in purported “peer-to-peer” trading. Susquehanna International Group (SIG), for example, is Kalshi’s primary market maker
• Authorize the state attorney general to impose major financial penalties on violators.
• Implement multiple player protection and responsible gaming measures such as marketing restrictions, an age minimum of 21, a ban on credit cards funding accounts.

Responsible gaming and protecting New Yorkers from addiction and predatory practices have always been top of mind for Addabbo.

“I do like the intent of the bill,” Addabbo said.

“What’s interesting is the bill went to the Consumer [Affairs and] Protection Committee, not the [Standing Committee on Racing and Wagering], but it is a consumer protection bill more so than a gaming bill.”

States vs. Prediction Markets: Can Legislation Be Effective?

While several states, New York included, are battling Kalshi in court, the legislative path has been less explored.

A legal sticking point is whether state law is pre-empted by federal law, since prediction markets are regulated under the CFTC.

The legislative process can also be quite cumbersome.

“To address an issue legislatively is not the most efficient way to do things sometimes because of the time frame it takes to do something legislatively,” Addabbo explained.

“I would like to have a conversation with the gaming commission to see if, administratively, that’s another way that we can address the situation, by having them set up some administrative guard rails.

“But nevertheless, I like the fact that at least we in the state are looking at ways to address this and not waiting for the federal government.”

ProphetX, a sports prediction platform currently operating under a sweepstakes model, has filed applications with the U.S. Commodity Futures Trading Commission (CFTC) to register as both a Designated Contract Market (DCM) and a Derivatives Clearing Organization (DCO).

If approved, ProphetX would become the first federally regulated exchange dedicated specifically to sports-based event contracts.

The company announced the filing on Monday, calling it a major step toward offering real-money trading on sports outcomes nationwide under federal oversight.

“Our goal has always been to build a transparent, compliant and innovative marketplace that treats sports outcomes with the same integrity and structure as any other asset class,” said Dean Sisun, CEO and Co-Founder of ProphetX. “Filing for DCM and DCO status is the next logical step in legitimizing the future of user-driven sports trading.”

Why the Shift Now?

ProphetX’s move comes amid tightening regulatory pressure on sweepstakes wagering models. Several states, including California, have taken action against sweepstakes-style gaming apps, while platforms have faced advertising restrictions and market withdrawals.

At the same time, prediction markets have gained serious traction in the U.S. Kalshi and Polymarket have gone through several massive funding rounds and seen rapid growth in trading volume across categories ranging from elections to sports to macroeconomic outcomes. Major gaming operators, including DraftKings, FanDuel, and Underdog, are now exploring federally regulated event-contract products of their own.

By seeking DCM and DCO status, ProphetX aims to shift from state-by-state gaming oversight to a single federal regulatory framework. This structure has drawn increasing interest from operators seeking a scalable compliance path.

A Sports-First Positioning

This distinction is significant.

Unlike platforms that started with politics or financial events and later added sports, ProphetX’s product has been sports-driven since launch. The company operated as a licensed sports betting exchange in New Jersey before transitioning to a sweepstakes model to reach more markets.

If approved, ProphetX would allow users to trade directly on outcomes of games and performance metrics, with contracts priced through market-driven supply and demand rather than traditional sportsbook odds.

Co-founder Jake Benzaquen called it “adapting sports to the CFTC framework,” rather than adapting the CFTC to sports. That might sound like a small semantic difference, but it reflects a strategic advantage: sports bettors are already prediction market participants, they just don’t use the vocabulary yet.

ProphetX is trying to build an interface that makes the transition feel native.

What Comes Next?

CFTC approvals for new exchanges are typically lengthy, and the agency has been operating with limited staffing due to the ongoing federal government shutdown. ProphetX does not expect a final determination until 2026.

In the interim, the company will continue operating under its existing sweepstakes model.

If approved, ProphetX would join Kalshi, Polymarket (returning U.S. operations), and Crypto.com’s exchange as platforms allowed to offer event contracts nationwide. It would be the first among them built exclusively for sports.

Essentially, ProphetX is betting that the future of sports trading looks more like the CME Group than Caesars. If they’re right, the sports betting industry will look very different in five years.

In the meantime, everyone else in the prediction markets industry will be watching the CFTC docket very closely.

DraftKings is done waiting for California and Texas to legalize sports betting, announcing in advance of its Q3 earnings call that it plans to launch a predictions markets platform that will include sports event contracts in the coming months.

While DraftKings Sportsbook operates in 25 states plus Washington DC and Missouri to come soon, about half of the country’s population remains without legal online sports wagering. It could be years before the two most populous states open their doors to mobile sportsbooks.

Florida, too, is closed to most operators, thanks to the Seminoles’ exclusive arrangement with the state.

Meanwhile, prediction markets, led by Kalshi, are offering sports event contracts in all 50 states, and DraftKings isn’t sitting idly by.

“We see Predictions as a significant incremental opportunity,” DraftKings CEO Jason Robins wrote in a letter to shareholders. “We are excited about our pending launch of DraftKings Predictions and its potential to expand our total addressable market.

“In the coming months, we expect DraftKings Predictions to enter many states with sport event contracts, unlocking a new customer base and revenue stream. Nearly half the country’s population remains without access to legal online sports betting, but there are several other companies offering federally regulated Predictions in all 50 states.”

Is DraftKings putting state licenses at risk?

Multiple states – Ohio, Arizona, Michigan, Illinois and Nevada – have warned their sports betting licensees they face serious regulatory repercussions if they get into the prediction markets business. Some of these warnings apply even if sports event contracts are offered outside the state’s borders.

Having a license revoked in one state could be just the first domino.

“Once you get a license stripped in one state it has a deleterious effect in other states,” Bill Pascrell III, an influential gambling industry attorney and lobbyist, told DeFi Rate last month.

States, though, will have to think long and hard before kicking out one of its top two sports betting tax revenue producers.

And pushing the envelope is exactly how DraftKings ascended to its dominant position.

Prediction markets dominated the Q&A portion of DraftKings’ earnings call on Friday.

Responding to a question on the company’s conversations with regulators and why it feels comfortable moving forward with prediction markets, Robins said, “Through the strength of those relationships and conversation [with regulators], we got comfortable in the approach that we’re taking. …

“As I said in our note and on the call, we aren’t going to be in every state with sports, [and] we won’t even be in every state with non-sports, and I think we have a good sense of where the sensitivity areas are.”

Robins has been consistent in his position that prediction markets won’t make much of a dent in states where sports betting is legal, a notion that lines up with the regulatory challenges.

“The states that already have legal regulated online sports betting, there isn’t going to be as much opportunity in the prediction space, at least in the sports prediction space,” he explained.

FanDuel treading more carefully?

FanDuel, DraftKings’ primary competitor in the regulated sports betting space, is also eyeing prediction markets, but the company is ostensibly being more cautious.

In August, FanDuel and CME Group announced a joint venture to develop and launch event-based contracts. DraftKings’ acquisition of Railbird Exchange, a CFTC-approved DCM, became official on Oct. 21. These deals are the sportsbooks’ on-ramp to prediction markets.

While “sports” was conspicuously absent from both the FanDuel/CME and DraftKings/Railbird announcements, the operators’ designs on sports event contract has never been a secret.

Bloomberg News reported last month the CME planned to launch sports-event contracts by the end of the year. Terry Duffy, the company’s CEO, clarified that sports has always been on the radar, but that he’s waiting for a firm ruling from the federal government on the legality of sports-based contacts before moving forward on them.

“As long as the U.S. government is not going to object to the self-certification of these and consider these swaps and not gaming …  we will proceed accordingly,” Duffy said on CME’s Q3 earnings call in October.

DraftKings bullish

A dip in sportsbook stocks has come in conjunction with the rise of prediction markets. The opportunities that await, though, have Robins optimistic.

In other news yesterday, DraftKings announced a deal to become ESPN’s official sportsbook and odds provider, following news that PENN Entertainment and the sports media giant are shutting ESPNBet.

“This is the most bullish I have ever felt about the future of DraftKings,” Robins told shareholders and analysts. “That may sound surprising given we are revising our fiscal year 2025 guidance ranges today, however, underlying growth in our business is accelerating. We are also increasingly advantaged through new exclusive marketing agreements with ESPN and NBCUniversal as well as our leading product offerings continuing to improve. Finally, we are launching DraftKings Predictions in the coming months.”

In his typically bold fashion, Robins added of prediction markets, “We will pursue this opportunity, we will compete, and we will win. For the same reasons that we have been successful competing in the sports betting industry, we expect to succeed here.”

Prediction markets are dangerously blurring the line separating gambling and investing, Schwab CEO Rick Wurster cautioned this week.

CFTC-approved prediction markets can certainly be used as legit financial instruments, but it’s their venture into sports, and the messaging behind it, that’s causing concern. Sports event contracts, synonymous with sports wagers, are being offered on an increasing number of financial trading platforms.

“Only 5% of the people that go on gambling apps pull out more money than they put into the gambling app — it is the opposite of the benefits of being a long-term investor,” Wurster said during his keynote at Schwab IMPACT in Denver on Wednesday, per Investment News.

“I hope as an industry, we’re able to tell the story to clients about the difference between gambling and investing. I just don’t want young people in our country that think that betting on the Monday Night Football game is equivalent to being invested for the long term in stocks and bonds.”

Sports are driving the growth

There are contracts on prediction markets that can serve as valuable financial hedges for sophisticated investors. Long on Bitcoin? Take a “no” position on the currency’s price on Kalshi. Invested in bonds? Buy the “yes” on the Fed cutting interest rates in December on Polymarket.

While there are tens of millions of dollars being traded in these markets, sports is the main driver of prediction markets’ exponential growth.

Sports accounts for around 90% of the trading volume on Kalshi. Robinhood is trumpeting prediction markets’ positive impact on the company’s financials, and it’s no secret that football is the key ingredient.

Annualized revenues from prediction market jumped to $115 million in Q3, up from $45 million in Q2, and according to Chair & CEO Vlad Tenev, volume has doubled every quarter since Robinhood launched prediction markets with the 2024 Presidential Election. In fact, there were 2.5 billion contracts traded in October, more than all Q3 combined.

Posing a question during Robinhood’s earnings call about changing consumer behavior, Deutsche Bank’s Brian Bedell connected the dots. “We’ve seen a big increase in volume, obviously, in September with the NFL and college games added,” Bedell noted (via Motley Fool).

In response, Tenev spoke of the diversity of contracts being offered, specifically mentioning culture and entertainment markets while omitting sports.

Prediction markets’ sports messaging is problematic

What’s troubling to many observers is that prediction markets, depending on their audience, promote the sports betting aspect of their platforms while pushing the narrative that sports contracts are solid investment vehicles.

Here’s the sports landing page on Crypto.com:

And in an August press release announcing that NFL and college football markets were being added to the platform, Robinhood said, “Unlike sports betting, where the firm sets a line, event contracts leverage the power and rigor of financial market structure and are offered in a marketplace where buyers and sellers interact to set the price.”

The reality is that trading sports contacts on a prediction market is generally as risky as placing bets on a sportsbook app. While “peer-to-peer” trading is part of the story prediction markets are trying to tell, institutional market makers are typically on the other side of the trade.

“You’ve seen an incredible rise on these financial services apps of people gambling on sports,” Wurster continued in his keynote. “In fact, if you log into some of the well-known financial services apps on a Monday to check your balances, you are likely to get a pop up alert asking you if you want to bet on Monday Night Football. The challenge I see with this is that investing over the long run pays off.”

Charles Schwab invested in Kalshi

While the top executive of his namesake company is sounding the alarm on prediction markets’ sports offerings, Charles Schwab was an early investor in Kalshi.

In a release dated Feb. 17, 2021, Kalshi announced a $30 million capital raise in which Schwab participated. The funding came after the CFTC approved Kalshi as a Designated Contract Market.

Kalshi didn’t start offering sports contracts until January 2025, about four years later.

At the time of the February 2021 funding, Kalshi was valued at $120 million. The company announced last month a $300 million investment at a valuation of $5 billion.

Prediction market rivals Polymarket and Kalshi have both struck partnerships with search engine behemoth Google.

The deals are part of a broader announcement by Google that it is upgrading Google Finance, including adding Deep Search capabilities and corporate earnings tracking, and expanding to India.

While Google says it will be upgrading its Google Finance platform to include the prediction markets’ “data”, Polymarket chooses the term “odds” in its social media posts.

Kalshi CEO Tarek Mansour promises a rollout over the next few weeks.

More validation for prediction markets

News of the Google agreements is further legitimization of prediction markets, even as multiple states claim they are acting illegally in the sports betting space.

But while sports event contracts comprise the bulk of trading volume on Kalshi, it’s clear the value of prediction market extends well beyond sticks and balls.

The predictive power of prediction markets are seen as a major enhancement for Google Finance.

“Prediction markets data from [Kalsh and Polymarket] means you can ask questions about future events to see current probabilities in the market and how they’ve changed over time,” Google product leader Rose Yao writes on X.

In a blog post announcing the deal, Google offers this example:

“Just ask something like ‘What will GDP growth be for 2025?’ directly from the search box to see current probabilities in the market and how they’ve changed over time.”

Lengthening list of dance partners

Google is just the latest corporate giant to partner with prediction markets.  

Intercontinental Exchange, the owner of the New York Stock Exchange, announced last month a $2 billion investment in Polymarket. CME Group, another one of the world’s largest financial exchanges, is set to launch a prediction markets platform with FanDuel.

The Google deal isn’t the first simultaneous partnership for Kalshi and Polymarket, the two fiercest competitors on the current prediction markets landscape. Last month, the NHL announced licensing deals with the companies at the same time.

Polymarket is coming

The US market still awaits the return of Polymarket, which was from the blocked from the country in February 2022.

Polymarket has been teasing its re-entry to the States for several weeks, and there have been reports that the government shutdown is delaying it.

The company is certainly positioning itself to make a big impact once it happens.

Crypto.com is partnering with Hollywood.com to launch an entertainment-based prediction market that will facilitate trades related to films, TV shows, music, awards shows, Broadway shows and more.   

The event contracts will be offered through Crypto.com’s CFTC-registered exchange and clearing house and available on Hollywood.com, an entertainment news site.

In the press release announcing the partnership, Crypto.com Managing Director of Global Head of Capital Markets Travis McGhee and Hollywood.com co-CEO Mitchell Rubenstein both speak of the passion of entertainment fans and the burgeoning popularity of prediction markets.

“Entertainment fans are some of the most passionate consumers and we look forward to providing them a new, legal prediction market specifically tailored to them through a trusted platform,” McGhee says in the statement.

Rubinstein boasts of “launching the first prediction platform dedicated entirely to movies, TV, video gaming, Broadway, pop culture, and celebrities” and “creating an entirely new way for fans to engage with the content they’re passionate about.”

Entertainment’s place in prediction markets

Press release hyperbole notwithstanding, entertainment-based event contracts are not exactly revolutionary. Betting on awards shows like the Oscars is allowed on several legal sports betting states, and there are dozens of entertainment markets on Kalshi and Polymarket.

On Kalshi, for example, participants can bet on:

• Top artist on Spotify this year
• “Predator: Badlands” Rotten Tomato score
• Oscar for Best Picture

And here’s a small sampling from Polymarket:      

• What will be the top global Netflix show this week?
• Highest grossing movie in 2025?
• Next James Bond actor

While sports accounts for the bulk of the trading volume on prediction markets, it’s clear the major players in the space are recognizing the potential in other verticals.

As we write this on Tuesday, Nov. 4, the day elections are being held around the U.S., politics dominate the top markets by volume on both Kalshi and Polymarket.

But prediction markets are feeling plenty of legal heat for offering sports event contracts, and allowing trading on elections was central to Polymarket’s expulsion from the US in 2022.

While it’s questionable whether entertainment can have as big an impact, prediction markets are likely to face less regulatory pushback against entertainment than sports or politics, enhancing the opportunity.

Crypto.com continues to make prediction market inroads

Kalshi has established early dominance, Polymarket looms as a US re-entrant, and FanDuel and DraftKings are teaming up with CFTC-approved exchanges. Crypto.com, though, is a company to watch as prediction markets ascend.

The digital currency exchange partnered with Underdog to offer sports event contracts in 16 states where sports betting is not legal.

More recently, Crypto.com announced a deal with Trump Media to launch Truth Predict, a prediction market that will be offered through Truth Social.

With its new Hollywood.com deal, Crypto.com now has partners in three key prediction market domains.