Underdog, Crypto.com launch sports event contracts in US
Underdog kicked off September with a major industry first, officially bringing sports event contracts to market through a new partnership with Crypto.com. The announcement, made on 2 September, marks the first time a sportsbook operator has launched sports event contracts.
The partnership is currently available in-app for Underdog users in 16 US states. While Underdog did not disclose the full list, reporting from CNBC suggests the offering is largely targeting states where sports betting is not yet legalised, such as California and Texas. “Prediction markets are one of the most exciting developments we’ve seen in a long time,” said Jeremy Levine, founder and CEO of Underdog.
Unlike the brand’s popular picks-style format, the new feature resembles a traditional sportsbook interface, displaying odds and allowing users to trade event contracts while games are in play.
Crypto.com sees expansion in sports prediction markets
Crypto.com, which has already been active in sports contracts, sees the partnership as a key opportunity to expand market reach.
“We are thrilled to partner with Underdog to enhance the sports experience for customers nationwide with the ability to now trade using Underdog’s technology – all in one app,” said Travis McGhee, Managing Director and Global Head of Capital Markets at Crypto.com. “We were the first to offer sports event contracts, and our technology partnership with Underdog will provide more access to CDNA’s innovative offerings.”
Regulatory pushback in Ohio raises questions
The launch comes just weeks after the Ohio Casino Control Commission (OCCC) issued warnings to licensed operators against partnering with event contract companies. The regulator stressed that such activity would be treated as illegal sports betting and could threaten their right to operate in the state.
“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 Founder and CEO Jeremy Levine
The OCCC also warned that even if operators geofence their offerings away from Ohio, partnerships with firms like Crypto.com could still jeopardise licences. If an operator partners, coordinates, or associates with a company involved in prediction markets, this will be taken into account when assessing their licence. The restriction also extends to activities conducted through a Designated Contract Market (DCM), a Futures Commission Merchant (FCM), or entities under common ownership.
The implication is that even operators working with separate divisions or affiliates could still be held responsible. In practice, this means sportsbooks considering new ventures in prediction contracts must weigh the risk of losing their primary sports betting licence in Ohio.
In April, the commission issued cease-and-desist orders to Crypto.com and other firms, though they continue to operate while federal court cases involving Kalshi, Crypto.com, and state regulators remain ongoing. Ohio law considers the sports-related event contracts offered by all three platforms to be unlicensed sports betting. And it’s not just Ohio. They’re the third heavyweight to enter the ring, following similar action in Nevada and New Jersey. This is no isolated jab. It’s becoming a coordinated crackdown. The Nevada Gaming Control Board (NGCB) recently entered a proposed Stipulation for Settlement with Resorts World Las Vegas (RWLV) and its parent companies following a disciplinary complaint.
Importantly, the OCCC’s directive applied specifically to sports betting licensees. It remains unclear if the same rules will extend to fantasy sports licensees, leaving Underdog some regulatory breathing room.
Competitors take a cautious approach
While Underdog pushes forward with its sports event contract model, other major operators are adopting a more cautious strategy. FanDuel, for instance, recently announced a partnership with CME Group to enter the event contracts space. However, FanDuel confirmed that sports-based contracts will not be included in its initial rollout. The initiative will allow users to place simple, fully-funded yes-or-no wagers on financial market events, beginning with trades for as little as $1. This has already sparked fresh tensions with Nevada gaming regulators, who pressed Flutter executives on their plans during a public meeting.
Meanwhile, FanDuel rival DraftKings was reportedly in talks to acquire Railbird Exchange, a newly federally licenced prediction market platform based in the United States. The details of the reported deal are still under wraps. A company spokesperson told SiGMA News, “DraftKings speaks to a variety of companies regarding various matters in the normal course of business, and it is our general policy not to comment on the specifics of any of those discussions.”
