Fast-growing fantasy and sports gaming firm Underdog has partnered with Crypto.com Derivatives North America, a CFTC-registered exchange and clearinghouse and an affiliate of Crypto.com, to offer sports prediction markets in 16 states.
The solution will prioritize states where legal sports betting has not been adopted, such as California and Texas, the companies told CNBC on Tuesday, with Underdog becoming the first sports gaming operator to offer prediction markets. It is designed to provide millions of people a federally compliant way to predict the outcome of their favorite sports events via the Underdog app, according to a subsequent statement from Crypto.com.
"Prediction markets are one of the most exciting developments we've seen in a long time," Underdog founder and CEO Jeremy Levine said. "While still new and evolving, one thing is clear — the future of prediction markets is going to be about sports — and no one does sports better than Underdog."
Following the launch, fans will be able to trade on sports outcomes across major leagues like the NFL, NBA, MLB, and college football, the companies explained. Prices update in real time, letting them react instantly and share their views on every play via the gaming licensed operator.
"We are thrilled to partner with Underdog to enhance the sports experience for customers nationwide with the ability to now trade using Underdog’s technology — all in one app," Travis McGhee, Managing Director, Global Head of Capital Markets at Crypto.com, said. "We were the first to offer sports events contracts, and our technology partnership with Underdog will provide more access to CDNA's innovative offerings."
Crypto.com and Underdog's predictions market joins the likes of Polymarket, Kalshi, and Robinhood in offering sports events contracts, enabling traders to buy and sell sports outcomes, with odds set by the market, not a bookmaker.
The CFTC and federal courts are still debating whether sports prediction markets count as gambling, infringe on state authority, or violate the Indian Gaming Regulatory Act. In May, the CFTC moved to dismiss an appeal against Kalshi after a federal judge ruled the agency had overstepped its authority in attempting to stop the crypto predictions platform from allowing users to trade contracts.
