To non-Americans, the rise of the prediction market space is an interesting, perplexing and exciting phenomenon, to name a few emotions. Something that anyone could have predicted, however, was the entry of some of gaming’s biggest firms into the sector.

Both Flutter Entertainment and Allwyn, the latter indirectly, have entered presidio this month. In Flutter’s case, the firm announced that its partnership with derivatives marketplace CME Group is being leveraged to create a new predictions platform based around the FanDuel brand.

No surprises here

Flutter plans to launch FanDuel Predicts next month as a standalone app, completely separate to the FanDuel sportsbook though carrying the same branding. This may help quickly establish the app as a big competitor to established prediction apps like Kalshi, the market leader in the space.

By sharing the FanDuel branding, the new Predicts platform will benefit from its sibling brand’s market leader status in US sports betting, its visibility in over 24 states (with Missouri expected to become its 25th state soon), and its sponsorship deals with the NBA, NHL, and other major sports stakeholders.

FanDuel Predicts’ markets will include sports events contracts including American football, basketball, baseball and ice hockey. It has not been confirmed whether politics markets, a mainstay of the typical predictions product seen on Kalshi and Polymarket, will be included in this, though it is highly likely.

Amy Howe, FanDuel CEO, said: “We can’t wait to bring FanDuel’s proven approach to market 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 experience our customers expect.”

Flutter and FanDuel’s entry into predictions has hardly been a secret, and many were speculating on whether the NYSE gambling giant would make the move way prior to its announcement.

The firm certainly has experience on its side, having operated the Betfair Exchange for nearly a decade. This experience of managing a global betting exchange will have lent itself well to managing a predictions platform.

Its intentions were confirmed earlier this year via the partnership with CME Group, mapping out plans to create an events contracts platform offering simple ‘yes’ or ‘no’ positions on events starting at $1.

FanDuel Predicts takes on the system

Flutter has set aside a significant sum of money to develop the FanDuel Predicts app. This will build on what has been a cost heavy Q3, with two hefty payments related to FanDuel and the winding down of its Junglee business in India driving up Flutter’s losses during the quarter.

These costs and losses have not deterred Flutter though. On the group’s post-Q3 earnings call, CEO Peter Jackson told analysts that the company has set aside funds of around $200m-$300m to invest in FanDuel Predicts. Leadership is intent on unseating Kalshi as the US’ leading predictions platform.

Flutter’s enthusiasm for predictions makes sense. The Commodity Futures Trading Commission (CFTC) has taken a much more hands off approach to predictions under Donald Trump than it did under Joe Biden, creating a more favourable regulatory environment.

Unlike sportsbooks, which need to secure licences from state gaming regulators individually, prediction markets have effectively been given the greenlight to operate across the US by the CFTC – although Kalshi has still found itself embroiled in legal battles with some state regulators. By launching FanDuel Predicts, Flutter is essentially taking the FanDuel brand national.

“We’re very excited about FanDuel Predicts,” Jackson said. “The ability to take this sports product to the half of America that can’t currently access the sports betting product is tremendously exciting.

“The ability to partner with CME and leverage all the years of experience we have and built over the years with Betfair exchange will make a very formidable competitor – and we have to put money behind it.

“From a customer acquisition perspective we are going to have a very disciplined approach as we always have done in the US, and we will be monitoring the active LTV dynamics. Ultimately we do want to see as many states passing legislation to approve sports betting as possible and then we can migrate those customers (Predicts) onto sports betting.

“I think it is important that we put strong investment behind this. We have an incredible brand, we’ll have a great product when the launch is in December, and I think we’ll have a market leading product in Q2 next year.”

FanDuel not alone, PrizePicks makes its move

Flutter is not alone in seeing gold in the US predictions space. While some like Entain and MGM have shied away from the sector, others in both the B2B and B2C side of things see huge opportunities there, as Sportradar’s CEO said during its own Q3 earnings last week.

PrizePicks, the American daily fantasy sports (DFS) platform recently acquired by Swiss-based international lottery company Allwyn, has been preparing its own push into the predictions scene.

This could be yet another huge moment for Alwyn. The firm has already secured its position as the ‘second largest listed gaming entertainment company globally’ after Flutter, according to group leadership, and gaining a stake in predictions could unlock another huge revenue stream.

PrizePicks announced that it would be moving into predictions just one day after Allwyn purchased a 62.4% stake in the company for $1.6bn, valuing it at $2.5bn in the process. It has now taken this a step forward by partnering with Polymarket, the biggest predictions provider globally.

Mike Ybarra, PrizePicks CEO, said: “As the No. 1 daily fantasy sports operator in the US, PrizePicks is thrilled to partner with Polymarket, a trailblazer in the prediction space, to open up new experiences for our millions of existing members and introduce our platform to millions of new customers.

“By entering the US predictions market, PrizePicks will create greater competition, drive innovation and deliver even more value directly to members. Together with Polymarket, we’ll continue to focus on product, innovation, and exceeding our customers’ expectations.”

PrizePicks is going to integrate Polymarket’s events contracts. Similar to FanDuel Predicts, the markets will cover sports, though PrizePicks has also confirmed that it will offer markets on entertainment and cultural moments.

The firm laid the foundations for the partnership by securing registration as a Futures Commission Merchant (FCM) with the National Futures Association (NFA) – this was the aforementioned push into predictions made one day after the Allwyn takeover.

This registration allows PrizePicks to offer CFTC-permitted derivatives contracts via partnerships with federally regulated exchanges – exchanges like Polymarket, which made a return to regulated US derivatives and predictions this year after a three-year absence due to a regulatory scuffle with the CFTC.

Polymarket gained an inroad back into its founding market via M&A, taking over CFTC-licensed exchange and clearinghouse QCEX, which has subsequently been remodelled as Polymarket US.

“PrizePicks has built one of the nation’s most exciting sports communities, and we are excited to help bring prediction markets into that world,” said Shayne Coplan, Founder and CEO of Polymarket.

“As we prepare to return to the US, this partnership shows how prediction markets can enhance fandom while setting a new standard for interactive, regulated sports engagement.”

Like FanDuel, PrizePicks may benefit from brand familiarity as it makes its move in predictions, having already built up a considerable customer base as one of the two biggest DFS platforms in the US alongside Underdog Sports.

The entry of Flutter and Allwyn’s key US assets into predictions goes to show just how big this space has become in America, captivating the attention of two of gaming’s biggest corporations.

Kalshi may have a fight on its hands in the form of two formidable new competitors, though of course these two firms will also be battling it out against each other in the fight for market share in this rapidly growing but still regulatory uncertain field.