When PrizePicks launches its prediction market platform across the U.S., it will have the power of a returning Polymarket behind it.
PrizePicks announced on Tuesday a multi-year partnership with the leading prediction market that will allow it to offer Polymarket’s event contracts, including on sports, on its app.
The fantasy sports and gaming operator’s release said it would offer markets on “a wide range of sports, entertainment, and cultural moments.” PrizePicks VP of Communications Elisa Richardson told SBC Americas that its exact prediction markets offering will vary from state to state as it seeks to stay on the right side of gaming regulators.
State gaming regulators take a dim view
“We are taking a proactive and careful approach to inform government officials and regulatory bodies of our planned launch, which has led to productive conversations,” Richardson added. “You’ll see us taking a mindful approach to where specific products are launched in order to maintain positive relationships with state regulators and legislators.”
That caution is understandable, given that gaming regulators in the likes of Ohio, Illinois, and Michigan have issued memos to directly warn licensed gaming operators about getting into the event contract space, even if they only do so outside of state borders.
PrizePicks currently operates to some degree in 45 states plus D.C.. It received a fantasy sports license in New York just last month, where the gaming regulator told Kalshi to cease and desist offering sports contracts and where legislators are looking to curb sports contracts. Meanwhile, PrizePicks’ new owner Allwyn is currently the official operator of the state lottery in Illinois, where gaming operators have been told that partaking in event contracts could jeopardize their licenses.
PrizePicks already licensed as FCM
Richardson told SBC Americas that it believes its approach to offering prediction markets is distinguished from other gaming operators’ as it proactively sought approval from the National Futures Association (NFA) before moving forward with any firm plans. In September, PrizePicks became the first gaming operator to be registered as a Futures Commission Merchant (FCM) by the NFA.
“I think what’s important to note is that unlike others entering this space, PrizePicks has secured licensure via the NFA, which we feel gives us the best opportunity to operate legally and long term,” she added.
NFA registration as an FCM enables PrizePicks to offer CFTC-permitted derivatives contracts through partnerships with federally regulated exchanges like Polymarket, similar to the role Robinhood plays in its partnership with Kalshi.
The deal comes after Underdog — the second-biggest fantasy pick’em operator behind PrizePicks — launched sports event contracts earlier this year in a deal with Crypto.com. Underdog’s approach is a little different to PrizePicks’ as it acts as a “technical service provider” to Crypto.com rather than as a licensed exchange or FCM in its own right.
Meanwhile, both FanDuel and DraftKings are working towards offering event contracts too, via a deal with CME Group and an acquisition of Railbird, respectively.
PrizePicks CEO Mike Ybarra said in the announcement that the partnership with Polymarket will open up new experiences for his company’s millions of existing members, and will help to introduce its platform to millions of new customers.”
Polymarket launch remains TBD
Polymarket Founder and CEO Shayne Coplan took to social media on Tuesday to hail the deal.
“PrizePicks has built one of the nation’s most exciting sports communities, and we are excited to help bring prediction markets into that world,” he said in the official release. “As we prepare to return to the U.S., this partnership shows how prediction markets can enhance fandom while setting a new standard for interactive, regulated sports engagement.”
Polymarket is currently preparing to officially relaunch in the U.S. market. The self-styled largest prediction market operator in the world said in early September that a “no-action position” from the Commodity Futures Trading Commission (CFTC) meant it was in the clear to offer “legal sports betting” in all 50 states.
Officially, Polymarket has not accepted trading from U.S.-based consumers since January 2022, when it struck a settlement with the CFTC as a result of allegedly failing to register with the regulator. It acquired the holding company of CFTC-licensed QCEX in July for $112 million, providing it with a clear route back to America under regulatory oversight. It has also struck major partnerships with the likes of X and the NHL.
Talk has suggested it could launch in the U.S. around the start of the NFL season, but it has yet to do so. Front Office Sports reported this week that the government shutdown may be the cause of the delay.
PrizePicks’ Richardson told SBC Americas there are no immediate timeline details for Polymarket’s return.
