Fantasy and sports gaming operator Underdog has teamed up with Crypto.com to bring sports prediction markets to 16 states.
The first rollout is focusing largely on areas in the US where legal sports betting has not been adopted. The partnership between Underdog and Crypto.com highlights the rising interest in sports prediction markets, with predictions giant Kalshi offering more and more sports-based markets and pressure rising on the CFTC to regulate the sector.
Underdog is the first sports gaming platform to enter the rapidly-growing prediction market arena. It offers traders a platform to buy and sell on the outcome of sporting events, with the odds changing according to market movements. Crucially, there’s no bookmaker to set the odds.
“Prediction markets are one of the most exciting developments we’ve seen in a long time,” said Underdog founder and CEO Jeremy Levine in a public statement. “While still new and evolving, one thing is clear: the future of prediction markets is going to be about sports, and no one does sports better than Underdog.”
Underdog and Crypto.com enters a thriving sports prediction markets sector
Already, prediction market operators Robinhood, Kalshi and Polymarket offer sports event markets, while Flutter-owned FanDuel recently announced it would partner with the CME Group to offer financial events contracts. DraftKings CEO Jason Robins has also told CNBC that there’s interest there to enter the sector as well.
The lure for these companies seems to stem from being able to cater to sports bettor in states where gaming regulators and tribal casinos push back on legal sports betting. For example, California and Texas both don’t allow sports betting, yet can engage in sports prediction markets – for now.
There is growing pressure on the CFTC to establish whether prediction markets count as betting. As it stands, prediction market operators are seeking to gain a foothold while they still can, ahead of any potential regulation.
Featured image: Crypto.com
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