DraftKings secures approvals for prediction markets launch
DraftKings has moved a step closer to launching its DraftKings Predictions platform in the United States after receiving crucial federal approvals from two major regulators.
Gus III LLC, the corporate entity behind DraftKings Predictions, has now been approved by both the National Futures Association (NFA) and the Commodity Futures Trading Commission (CFTC) to operate as an introducing broker (IB). According to regulatory filings, the company was listed as an approved NFA member and an approved swap firm on 4 December.
The approvals position DraftKings to expand into federally regulated event-based markets, an area attracting growing interest from both sportsbook operators and financial exchanges.
A DraftKings spokesperson welcomed the progress, telling SBC Americas: “This registration marks an important step in the company’s federally regulated operations and supports the upcoming launch of DraftKings Predictions. We appreciate the NFA’s diligence in the process and remain committed to operating responsibly, transparently, and in full compliance with federal regulation.”
What the approval means for DraftKings
The green light from the NFA and CFTC gives DraftKings a legitimate pathway into regulated derivatives-style products tied to future events, allowing the operator to broaden its offering beyond traditional sports betting. It also comes at a time of heightened competition, with major financial institutions exploring similar markets.
DraftKings is entering prediction markets via the acquisition of Railbird Technologies Inc., a federally regulated trading venue licenced by the US Commodity Futures Trading Commission (CFTC). The terms of the deal were not disclosed. Railbird is licenced as a Designated Contract Market (DCM), giving DraftKings a direct pathway into regulated real-money markets tied to future events.
Wall Street rivalry intensifies
The acquisition came amid rising competition from heavyweight financial exchanges. Chicago Mercantile Exchange (CME) Group and Intercontinental Exchange (ICE) are both exploring how existing derivatives licences could allow entry into gambling-adjacent markets. CME partnered with FanDuel to develop event-based contracts tied to economic and market indicators, a move that rattled betting operators and stirred regulatory scrutiny. As interest in these markets grows, many bettors are also exploring where to find the best online sportsbetting options to complement emerging prediction platforms.
DraftKings Predictions to launch on mobile app
DraftKings has not confirmed a launch date for DraftKings Predictions, but regulatory momentum suggests the product could debut in the near future. DraftKings Predictions is a new product that will allow users to trade yes-or-no contracts tied to finance, culture, and entertainment.
Chief Executive Officer Jason Robins previously said the company is “excited about the additional opportunity that prediction markets could represent for our business.”
A spokesperson said DraftKings has not yet decided whether it will offer sports-related contracts, a move that could face pushback from state gaming regulators, who insist that companies under their purview cannot simultaneously operate federally regulated event markets.
DraftKings re-engages with NFA
Despite previously ruling out a 2025 launch, DraftKings has been quietly preparing to join the US prediction markets industry. On 24 June, the company re-filed an application with the National Futures Association (NFA), this time under Gus III Holdings LLC, seeking approval to operate as both a Swap Firm and an Introducing Broker. The filing includes CEO Jason Robins, CFO Alan Ellingson, and co-founder Paul Liberman. This marked DraftKings’ second attempt after withdrawing an earlier application under Gus II Holdings.
During the Q2 earnings call, Robins told investors that DraftKings is “actively exploring” prediction markets as regulations evolve. The NFA filing could support DraftKings’ expansion into DCM-style exchanges similar to Kalshi, and aligns with the long-rumoured interest in acquiring Railbird, now confirmed.
A representative previously told SiGMA News: “DraftKings speaks to a variety of companies regarding various matters in the normal course of business… we do not comment on specifics.” The company also withdrew a federal licence application in April, saying prediction markets remain an “emerging product that warrants thoughtful consideration.”
Meanwhile, in October, DraftKings CEO Jason Robins dismissed prediction markets as viable competitors to sportsbooks in the US, saying he “just doesn’t see a world” where customers would choose platforms like Polymarket or Kalshi over traditional sportsbooks in states with legal betting.
Competitive surge across prediction markets
DraftKings is entering a sector experiencing rapid acceleration. Rival operator FanDuel is partnering with CME Group on a new event-contracts joint venture. Over the past two years, the prediction-markets space has exploded with entrants, including PrizePicks, Underdog, Novig, and President Donald Trump’s Truth Predict. On 3 December, Fanatics launched its own platform across 10 states, including Delaware, South Dakota, and Utah.
While NFA membership is not required for DCMs, it is mandatory for Futures Commission Merchants (FCMs), which handle customer accounts and compliance. Approval involves extensive background checks and strict ethical standards.
Meanwhile, prediction market platform Kalshi closed October with its strongest performance to date, logging around $4.4 billion in trading volume, according to multiple industry reports. The figure represents not only a record month for the company but also a clear signal of how far regulated prediction markets have come in attracting mainstream attention.
While Kalshi dominated the month in trading volume, October marked a remarkable comeback for Polymarket. Only a few months ago, the platform appeared to be losing steam, with monthly active traders slipping to a low of 227,420 in August.
Subscribe HERE to SiGMA’s Top 10 News countdown and SiGMA’s weekly newsletter to stay up to date with all the latest iGaming News from the biggest iGaming community in the world and benefit from subscriber-only offers.
