DraftKings to launch new event contracts app ‘DraftKings Prediction’ after acquiring CFTC-licensed Railbird
Summary
DraftKings has acquired Railbird Technologies Inc. and its Railbird Exchange, gaining access to a CFTC-registered designated contract market (DCM). The move lets DraftKings enter regulated prediction markets for event contracts tied to real-world outcomes outside of sport, such as finance, culture and entertainment.
DraftKings will roll out a new mobile platform called DraftKings Predictions in the coming months. The product is designed to trade non-sports event contracts and can connect to multiple exchanges, potentially listing contracts from other CFTC-approved platforms. Railbird — founded in 2021 and licensed by the CFTC in July after a long approval process — provides the regulated infrastructure, with clearing services from QC Clearing (owned by Polymarket).
The announcement stops short of including sports markets for now, noting scope could expand over time; regulators in several states have warned that sports event contracts may be considered unlicensed gambling. DraftKings did not disclose the purchase price. Following the news, DraftKings shares rose about 7.1% in after-hours trading.
Key Points
- DraftKings acquired Railbird and its CFTC-registered Railbird Exchange, marking its entry into prediction markets.
- DraftKings Predictions will be a mobile app for trading event contracts tied to non-sports outcomes (finance, culture, entertainment).
- The platform can connect to multiple CFTC-approved exchanges, potentially including third-party contracts.
- Railbird secured its CFTC licence in July; its clearing is handled by QC Clearing, affiliated with Polymarket.
- DraftKings left open the possibility of expanding into sports markets later, though state regulators have flagged enforcement risks for sports-related contracts.
- Deal advisors included Sullivan & Cromwell for DraftKings; financial and legal advisers represented Railbird — purchase price undisclosed.
- DraftKings’ shares jumped ~7.1% after the announcement, adding roughly $1.2bn to market capitalisation.
Why should I read this?
Short version: this is a big strategic pivot. DraftKings isn’t just tinkering at the edges — it’s buying a CFTC-regulated entry ticket into prediction markets. If you track sports betting, market expansion or regulatory shifts, this could reframe competition and product strategy across the sector.
Punchy take: Must-read for industry watchers — the move accelerates a new product category that rivals and regulators are already reacting to, and it has immediate market impact.