Fanatics deepens prediction markets strategy with BGC deal
Fanatics has agreed to acquire two regulated market businesses from BGC Group as it looks to strengthen its position in the fast-growing prediction markets sector. The deal includes Water Street Labs and CX Clearinghouse, although financial terms have not been disclosed.
Water Street Labs is a Commodity Futures Trading Commission (CFTC)-registered Designated Contract Market (DCM), while CX Clearinghouse is a CFTC-registered Derivatives Clearing Organisation (DCO). Once the acquisition is completed, Fanatics will be able to operate its own federally regulated prediction market exchange and clearinghouse.
The move is expected to give Fanatics full control over its prediction market infrastructure, allowing the company to list and clear contracts directly instead of relying on third-party platforms.
Move to expand prediction markets
Fanatics said the acquisition will help expand the range of products available through Fanatics Markets, its prediction trading platform, while giving it greater flexibility to launch new markets in the future. Although Fanatics will take ownership of the exchange and clearing operations, BGC Group will continue to play a role through a long-term partnership between the two companies.
Under the agreement, BGC will provide its expertise in market data and analytics to help develop new products for prediction markets. The companies plan to combine prediction market data with traditional financial market information, creating new data services aimed at both retail and institutional users.
Matt King, CEO of Fanatics Betting and Gaming, said BGC’s experience in regulated exchanges, clearinghouses and trading technology made it the right partner as Fanatics continues to grow its prediction markets business.
BGC Co-CEO John Abularrage added that the partnership would combine BGC’s institutional market expertise with Fanatics’ large consumer base, helping prediction markets reach a wider audience.
Fanatics entered the prediction markets space in December 2025 with the launch of Fanatics Markets. The platform allows users to trade event-based contracts rather than place traditional sports bets.
As digital gaming and trading platforms evolve, many users also choose to play casino games for free through demo versions to explore game mechanics without using real money.
Drifting away from the sportsbook
The platform initially focused on sports-related markets before gradually expanding into areas such as finance, economics, politics and entertainment. Fanatics Markets is now available across 23 US states and four US territories, with the company continuing to expand its reach where regulations allow.
The platform also forms part of Fanatics’ wider ecosystem by integrating loyalty rewards through FanCash and Fanatics ONE. Users can earn rewards while trading and access additional features such as Combos, FanViz, and built-in risk management tools designed to encourage responsible trading.
Before this acquisition, Fanatics relied on infrastructure provided through a partnership with Crypto.com’s North American derivatives business. By acquiring Water Street Labs and CX Clearinghouse, the company will now be able to manage the exchange and clearing process internally.
Industry observers believe the move reflects growing competition in the US prediction markets sector, where operators are increasingly investing in regulated infrastructure rather than relying on external providers.
With full ownership of its exchange, continued support from BGC, and a rapidly expanding customer base, Fanatics appears to be positioning itself for the next phase of growth as prediction markets continue to gain momentum across the United States.
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