DraftKings’ Robins sees opportunity for prediction markets in non-sports betting states
Summary
DraftKings CEO Jason Robins told the 2025 BofA Gaming and Lodging Conference that prediction markets — sports derivatives resembling futures contracts — could unlock a large total addressable market in US states where online sports betting remains illegal. Robins said DraftKings will take a measured approach and must resolve regulatory and liquidity questions before any launch.
Content summary
Robins suggested that major states without online sports betting (implicitly California and Texas) represent a clear opportunity for prediction-market offerings. DraftKings has explored options, including reported talks with Railbird Exchange, but has not included a launch in its 2025 guidance. The firm must balance federal-level developments (eg CFTC engagement with some exchanges) against state regulators’ stances. Operationally, exchanges depend on market makers to provide continuous liquidity, a dynamic different to DraftKings’ traditional sportsbook model that limits sharp action and manages exposure via customer limits.
Source
Key Points
- Robins described the TAM for sports derivatives in non-sports-betting states as likely “very significant”.
- DraftKings is not rushing to be first mover and is taking a measured approach rather than committing to a 2025 launch.
- State-level regulatory exposure is a major concern for DraftKings; some exchanges operate under different federal frameworks.
- Prediction markets require market makers to supply liquidity and to take the opposing side of large trades — a structural challenge compared with sportsbook operations.
- Competitors and partners are already active: Flutter/CME, Crypto.com/Underdog, Kalshi and Polymarket have all made regulatory or commercial moves.
- Early Kalshi NFL trading showed high volume but wider pricing versus traditional sportsbooks; adding market makers tends to narrow spreads.
Context and relevance
The piece matters to operators, investors and regulators watching product innovation in US wagering. Prediction markets could let operators reach customers in states where traditional online sportsbooks are restricted, but they also bring distinct regulatory, pricing and risk-management challenges. Expect more partnerships, regulatory engagement and possible M&A activity as major operators weigh their paths.
Why should I read this?
Quick heads-up: if you track sports betting or operator strategy, this flags where product expansion could happen next. DraftKings isn’t leaping in, but its interest shows prediction markets are moving from niche to mainstream—and that shift could reshape how big states are served. We’ve read it so you don’t have to.