Underdog Sports Expands into prediction Markets wiht Crypto.com Partnership
NEW YORK – Daily fantasy sports and sports betting operator Underdog is making a critically important move into the burgeoning prediction market space, announcing a partnership with cryptocurrency exchange Crypto.com. The deal, revealed today, will leverage Crypto.com’s infrastructure to facilitate Underdog’s new prediction market offerings, initially focused on non-political events.
The move signals Underdog’s confidence in the future of prediction markets, particularly within the sports realm.”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,” said Underdog CEO Jeremy Levine.
Prediction markets allow users to wager on the outcome of future events, differing from traditional sports betting in that customers bet against each other rather than against a house. Though, the rise of these “event contracts” – particularly those focused on sports - has drawn scrutiny from regulators, with opponents arguing they effectively function as sports betting.
Other prediction market platforms have faced legal challenges. Kalshi, registered with the Commodity Futures Trading Commission (CFTC), has received cease-and-desist orders from at least seven state regulators sence launching its sports offerings earlier this year, prompting lawsuits in New Jersey, Nevada, and Maryland.Polymarket, another platform, is preparing to reenter the U.S. market after a 2022 settlement with the Biden Administration prohibited its operation within the country.
Notably, both Kalshi and Polymarket have garnered support from donald Trump Jr., who serves as a strategic advisor to kalshi and recently joined Polymarket’s advisory board following an investment from his venture capital firm, 1789 Capital.major sports leagues and traditional sportsbooks are closely monitoring the growth of prediction markets. The NFL has expressed similar integrity and compliance concerns as it does with traditional sports betting, while FanDuel recently announced a partnership with CME Group to enter the prediction market space - though initially excluding sports offerings.
Underdog currently operates as a licensed sports betting operator in North Carolina and plans to expand into Missouri following the recent legalization of sports betting in the state. The company is best known for its daily fantasy sports platform.
