In a notable expansion of its prediction market offerings, FanDuel has partnered with Crypto.com to introduce contracts from a second exchange. This collaboration aims to diversify the markets available to customers across sports and entertainment categories, enhancing their experience by allowing deeper trading possibilities, particularly the combination of event contracts, commonly known as parlays.
James Cooper, Senior Vice President for New Ventures at FanDuel, emphasized the positive outcomes of this partnership, stating that it would provide users with a broader array of choices. The move is seen as a strategic enhancement for FanDuel Predicts, a platform that already allows trading on non-sports outcomes, including financial indices and cryptocurrency prices, available in all 50 states. Additionally, sports event contracts can be traded in regions where FanDuel does not operate a state-regulated sportsbook.
This announcement comes on the heels of a lukewarm kickoff for FanDuel’s prediction market initiative, which was originally launched in December in collaboration with the renowned commodities exchange, CME. Although FanDuel hasn’t disclosed precise trading volumes from their exchange, data from CME indicates that it currently lags behind industry leaders, averaging around $4 million in contracts traded daily.
Prior to the current partnership, FanDuel exclusively utilized CME contracts. This limitation likely contributed to a constrained trading volume, as these contracts were also available on competing platforms, including DraftKings. In contrast, DraftKings has seen significant success by integrating contracts from both Crypto.com and CME, revealing an annualized trading volume of $3.1 billion in May, translating to approximately $8.5 million in daily volume. Their consumer-focused figures—excluding market makers for a fairer comparison to sports betting—showed an annualized total of $1.3 billion, equating to around $3.6 million daily.
In comparison, top competitor Kalshi has dominated the market with an impressive average of over $650 million in daily trading volume. FanDuel intends to distribute the new contracts through FanDuel Predicts, which operates under its status as a registered futures commission merchant (FCM), in which CME holds a 51% ownership stake. While FanDuel has also filed for its independent FCM application, it remains pending approval.
With this partnership alongside Crypto.com, FanDuel aims to reinvigorate its prediction market platform and compete more effectively against both DraftKings and Kalshi in the burgeoning market for prediction trading.
