DraftKings has launched a new platform called DraftKings Predictions, letting users legally trade on real-world events in 38 U.S. states, including those where sports betting is banned.
Key Takeaways
- DraftKings Predictions is now live in 38 U.S. states, including major non-sports betting markets like California, Texas, and Georgia.
- The platform is regulated by the U.S. Commodity Futures Trading Commission (CFTC), allowing it to bypass state-level gambling bans.
- Initially connected to CME Group for clearing trades, DraftKings plans to expand to additional exchanges, including its newly acquired Railbird Technologies.
- Users can trade on outcomes in sports, finance, and politics, with entertainment and culture categories planned in the future.
What Happened?
DraftKings launched its much-anticipated prediction market platform, DraftKings Predictions, on Friday. The new app and web product lets eligible users trade on yes/no outcomes in sports, financial markets, and politics. While resembling a sportsbook in appearance, the platform is structured as a federally regulated prediction market broker, not a gambling operation. This critical difference enables it to operate legally even in states where online sports betting is prohibited.
Today, we announced the launch of DraftKings Predictions, marking our entry into prediction markets.
— DraftKings News (@DraftKingsNews) December 19, 2025
Full press release available here: https://t.co/PDSCxD9j78 pic.twitter.com/MPgXK5fgzh
DraftKings Eyes a Broader Audience with Federally Regulated Prediction Markets
DraftKings Predictions marks a bold expansion into the fast-growing world of event contracts. The platform is now available in 38 states, offering a legal workaround for users in regions that currently block online sports betting. These include Texas, California, Florida, and Georgia, where sports gambling legislation has repeatedly stalled.
By launching this platform under CFTC oversight, DraftKings sidesteps the need for state-specific sports betting licenses. This federal route places DraftKings alongside Kalshi as one of the few companies capitalizing on this regulatory path. The platform functions similarly to a financial exchange, matching users on opposite sides of a trade and collecting a small transaction fee, rather than profiting from bets directly.
The app cleared its first trades through CME Group, a heavyweight in financial derivatives. This collaboration mirrors a similar model used by rival FanDuel Predicts. DraftKings also plans to connect the platform to additional exchanges, including Railbird Exchange, operated by its recent acquisition Railbird Technologies. This will allow for broader market offerings and potentially lower operating costs over time.
While users in all 38 states can access the app, not all markets are available everywhere. For example:
- Only 16 states currently allow full access to sports contracts.
- States like Connecticut limit access to financial markets only.
- Users in Michigan, New York, and New Jersey cannot access sports-related markets but can trade on political or financial outcomes.
- States like Arizona, Illinois, Nevada, Ohio, and Pennsylvania remain off-limits due to regulatory resistance.
Competitive Landscape Heats Up
DraftKings’ move comes at a time when the prediction market space is rapidly gaining attention. Coinbase and Robinhood also announced deeper plans into the event contracts arena, indicating the segment’s growing potential.
With its massive user base, brand trust, and partnerships with NBCUniversal and ESPN, DraftKings is well positioned to dominate this emerging category. “People already associate us with sports… I think it’s going to be really tough for anyone to compete with us,” said CEO Jason Robins during a recent earnings call.
In Texas, for instance, the platform’s entry is particularly significant. Despite repeated legislative failures to legalize sports betting, Texans can now use DraftKings Predictions to place trades on everything from football outcomes to the price of Bitcoin.
CoinLaw’s Takeaway
Honestly, this is a smart move by DraftKings. In my experience covering both financial and betting markets, prediction platforms like this are the future. The regulatory workaround through the CFTC opens up nearly half the U.S. market that was off-limits before. What stands out most is that DraftKings isn’t just playing in the sports arena anymore. They’re eyeing financial, political, and cultural events, too. I found it especially clever how they’ve aligned with major financial exchanges like CME and acquired Railbird to control more of the ecosystem. If they execute this right, they could define the standard for prediction markets in the U.S.
