CME Group, FanDuel ink fresh deal to launch new prediction market as competition heats up

Core Insights - CME Group and FanDuel are launching a new prediction market product called FanDuel Predicts in December, allowing users to wager on sporting events, gas prices, and cryptocurrencies [1] - The product will be available only in states where sports betting is not yet legal and will be excluded from tribal lands [2] - Flutter CEO Peter Jackson highlighted that FanDuel Predicts presents an immediate growth opportunity, particularly in states where FanDuel sportsbook is not available [3] Market Context - The joint venture is part of a trend among gaming companies and crypto exchanges, with similar launches from DraftKings and Coinbase [4] - Prediction markets have gained popularity, especially following the success of platforms like Polymarket and Kalshi, which facilitated significant trading volumes leading up to the 2024 US Presidential election [5] - Weekly notional volume for prediction markets reached approximately $2 billion in November, peaking at $3 billion recently, primarily driven by sporting events [5] Regulatory Landscape - The rise of prediction markets has attracted attention from state regulators, leading to disputes over regulatory authority [6][7] - The New York Gaming Commission issued a cease-and-desist letter to Kalshi for operating without a gaming license, and similar actions have been taken against other companies like Crypto.com [8]