DraftKings is expected to launch sports prediction markets before the New Year, marking the company’s first move into the controversial new category.
That is according to Citizens analyst Jordan Bender, who issued a research note Tuesday following DraftKings’ announcement that it had acquired Railbird Exchange, a CFTC-licensed event-contracts platform. The company said the acquisition will support the launch of a new product called DraftKings Predictions “in the coming months.”
While DraftKings’ press release made no mention of sports — mirroring a similar omission from FanDuel’s own predictions announcement earlier this year — Bender told LSR he believes DraftKings will debut a sports-related offering before 2026.
No confirmation from DraftKings
When contacted by Legal Sports Report, a DraftKings spokesperson said:
“We’re still evaluating and no decisions have been made at this time. DraftKings Predictions is expected to offer event contracts on financial, cultural, and entertainment outcomes, with the potential to expand into additional categories over time.”
DraftKings’ stock was up nearly 5% in after-hours trading around 7 pm Eastern.
DraftKings-Railbird terms not public
The terms of the Railbird deal were not disclosed, though Bender said the acquisition likely involved a small upfront payment with an earn-out tied to future performance.
DraftKings’ entry into the space comes as state regulators and attorneys general have warned that trading on sports outcomes constitutes unlicensed gambling, with several states, including Nevada most recently, threatening to revoke betting licenses for operators that participate.
Multiple lawsuits from states and tribal nations are already challenging similar markets offered by Kalshi and Polymarket.
DraftKings follows FanDuel
At the G2E conference in Las Vegas earlier this month, several financial analysts indicated FanDuel parent Flutter also expects to launch sports predictions before year-end, setting up a potential new front in the competition between the two leading U.S. sportsbooks. That was before Nevada’s regulators were vocal, though, and that launch could now be off.
DraftKings described the Railbird deal as part of a broader strategy to expand its “addressable opportunity through regulated event contracts,” signaling its intent to operate within federal CFTC oversight.
“We are excited about the additional opportunity that prediction markets could represent for our business,” CEO Jason Robins said. “We believe 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.”
