Despite warnings to the contrary in Nevada and an industry-wide opinion that prediction markets are a roundabout way to skirt gambling regulation, sports betting and gaming giants such as DraftKings have been making tentative attempts to gain a foothold in the vertical.
Prediction markets and exchanges may be unavoidable, the DraftKings acquisition suggests
DraftKings has acquired Railbird Technologies Inc., and wholly owned subsidiary Railbird Exchange, LLC. In a press statement, DraftKings did not mince its words and said that this was part of its ongoing push to enter prediction markets and expand its addressable opportunity through regulated event contracts.
Commenting on the acquisition, DraftKings Co-founder and CEO Jason Robins confirmed that the company was indeed looking to explore the additional markets that prediction markets provided.
"We believe that Railbird’s team and platform—combined with DraftKings’ scale, trusted brand, and proven expertise in mobile-first products—positions us to win in this incremental space," Robinson added.
This acquisition also coincides with the upcoming launch of a new app, DraftKings Predictions, which is built to further strengthen DraftKings’ presence in this burgeoning market, which is emerging as a competitor to the traditional sports betting sector.
DraftKings, however, will focus on real-world outcomes across finance, culture, and entertainment at first, with the company heeding regulatory warnings and holding the industry line that sports event contracts are not entirely legal.
Railbird welcomes the acquisition, hails it as an important next step
Railbird CEO and Co-Founder Miles Saffran was similarly pleased with the opportunity and said, "This is a transformational moment for our company, and we are thrilled to be a part of the future of DraftKings.DraftKings’ scale and leadership in the industry create meaningful opportunities for our team and platform."
DraftKings is not the only company considering this move, with FanDuel and other sports betting giantsstaving off competition from the likes of Kalshi.
With Polymarket set to return to the United States, and the company recently receiving a $2bn cash injection from NYSE’s parent company, the future of prediction markets seems to be guaranteed.
Sports betting companies are willing to bet on it.
