Jason Robins thinks sports predictions exchanges will be popular in states without legal sports betting, but he struggles to see how they will compete in legal states.
The CEO of DraftKings talked predictions vs. sports betting at the Bank of America Securities 2025 Gaming & Lodging Conference on Thursday, laying out the differences between products.
“I just think it’s virtually impossible under that type of regulatory framework to ever have something that could be as rich and varied as what you see in an online sportsbook,” Robins said. “But no doubt, there will be in a state that doesn’t have an online sportsbook available, at least a legal one, there will be people that just want to go and do game lines and other simpler stuff that’s available on it.
“So that’s kind of like the way I look at it. I think where you have both, it’s clearly, in my mind, going to be challenging for that product to compete. But I think where you don’t have anything else, it’s pretty good.”
Sports betting wins in the UK
The United Kingdom is a good example of how sports exchanges coexist with legal sports betting products, according to Robins.
“One, evidence-based [United Kingdom] example, that is a market where both products coexist together, and it’s a single-digit percentage of the total revenue, which I think is an indication that when both products are available, customers overwhelmingly prefer the traditional online sports betting product,” Robins said.
Predictions cannot limit players, offer fewer markets
The other side is the logistics of trying to compete with those sportsbooks and knowing who is involved in the action, he said.
“The other thing I would say is just, if you think about it conceptually, it’s going to be very difficult to ever have as full featured and offering in a prediction market setup as you could in an online sportsbook,” Robins said. “One of the chief reasons being risk management, when you are putting, as a market maker, a market up on an exchange, you just have to be comfortable with anyone taking that liquidity.
“Anyone can fill that order versus we are able to place limits on sharps and other people, and that is the only reason we’re able to offer the variety of bets and things that we can. If we offered all the different bets that we offered, and we weren’t able to [limit customers], we would get picked off and destroyed, right?
“So I think that is going to be a limiting factor for not just the variety of bets, but parlays and other sorts of combinability and things like that. For example, if you are putting out – we were just talking about this earlier, actually, a very high leg parlay, you have to collateralize the potential winnings on that every time you do that.”
Silence does not equal inaction on predictions
Just because there have been no press releases or announcements from DraftKings about predictions does not mean they will be caught flat-footed, Robins explained. The company is reportedly interested in acquiring an already approved prediction exchange.
“I don’t think we feel like we have to announce what our plans are until, if time came, we were ready to actually act on those plans or pretty close to ready to act on those plans,” Robins said. “And I think that’s just the best way of kind of seeing what happens without being committal, but also doesn’t mean internally we can’t be preparing and doing things and slowing down at all there.
“So I don’t know if it’s as much I’d say, like, we don’t think that we should be an early mover or anything like that as much as it is we have to make sure we have the right thing and we are prepared to do it. And when that happens, if that happens, we’ll announce something, but we don’t feel like we need to announce anything ahead of that, which is a different strategy than I think others take, but there’s pros and cons to both, I think. But that’s just, for better or worse, how we’ve always kind of operated in these types of situations.”
Flutter recently announced its intentions to offer predictions within FanDuel, but did not mention sports predictions in the announcement. Underdog, on the other hand, is already live with sports predictions in 16 states, mostly those without legal sports betting.
