Prediction markets are exchange platforms that allow users to buy and sell contracts whose value is tied to the outcome of specific future events. It is essentially investing in — many observers would say betting on — whether a certain event will occur, with values based on probabilities, supply and demand, and other factors. On key platforms such Kalshi and Polymarket, among many others, users can seek a payoff based on whether it will rain in a certain city, if a celebrity will die, whether the U.S. will buy Greenland, or any number of other potential future happenings in politics, pop culture, economics, and more.
Prediction markets have been around for more than five years, but really took off in 2025. Sports has been a big driver. Kalshi, for instance, says that 90% of its business is due to sports trades, as users stake their fortunes on things like the outcomes of games and tournaments, hirings and firings, players drafted, player performance milestones, and the like. They can bet on whether an athlete will retire, throw for 300 yards in a game, or enter the transfer portal, to name a few of the almost limitless possibilities.
The prediction market landscape is changing fast. New prediction platforms are entering the business, while the more established platforms are securing new funding. (Many observers expect to see consolidation in 2026.) Traditional and social media brands, including CNN, CNBC, The Wall Street Journal, Time, DAZN, Google Finance, and Truth Social, are signing pacts with prediction platforms at a fast pace, and crypto platforms including Coinbase, Gemini Trust, Crypto.com, and others are getting into the game themselves and bringing in partners.
The major sportsbook companies are also involved, with FanDuel launching FanDuel Predicts and DraftKings starting DraftKings Predictions last fall. But they are careful to separate their prediction market offerings from their existing betting activities, for legal and regulatory reasons. They are offering prediction markets only in states where they do not operate a licensed sportsbook, for example, staying away from offering sports bets on their prediction platforms (at least initially), and/or implementing other strategies on a state-by-state basis to try to avoid legal issues. Meanwhile, fantasy sports providers are also increasingly interested in the prediction market space.
The legal situation is unsettled. Prediction markets are regulated federally as derivatives markets by the Commodity Futures Trading Commission (CFTC), but there is little regulation by the states yet. Legislators in places such as New York have introduced bills to restrict the practice. Some state betting regulators have filed lawsuits against the key platforms, most of which are still making their way through the courts. The granting of cease-and-desist orders against prediction platforms at the request of various states has in turn caused the platforms to sue state regulators. Class-action lawsuits on behalf of users are also starting to appear.
Despite the upheaval in this emerging market, some sports leagues and other entities are forging deals with prediction markets. Not only do they see the potential for significant growth in usage and revenue, but they want to get in early to protect their own interests, as their business will be subject to prediction market activities whether they want that or not.
Here are some examples of recent deals involving pro sports leagues and other members of the sports industry:
- The National Hockey League became the first U.S. major pro sports league to enter the prediction arena, through deals with both Kalshi and Polymarket, announced in October 2025. The move has been controversial, but the league noted that these agreements are a way for it to control its own fate in this space.
- The NHL’s New York Rangers signed Polymarket as the team’s official prediction market partner earlier this month. That followed an alliance revealed in December involving another NHL team, the Chicago Blackhawks, which partnered with Kalshi.
- TKO, licensor of two mixed martial arts leagues, UFC and Zuffa, entered into an agreement with Polymarket, announced in November 2025.
- The Pro Padel League signed a deal with Kalshi, announced in October 2025, as did the United Pickleball Association, which manages the Carvana Pro Pickleball Association Tour and Major League Pickleball, a month earlier.
- Golfer Bryson DeChambeau, who competes on the LIV tour, signed on as the first athlete endorser of Kalshi in January 2026.
- Fanatics, which plays a dominant role in sports licensing, merchandising, and retailing, and is a growing player in all aspects of the sports industry, including sports betting, launched Fanatics Markets, a sports prediction platform, in December 2025. It currently operates in 24 states, avoiding jurisdictions where sports betting is legal.
Other sports organizations have taken a different tack, avoiding or pushing back on prediction market partnerships, due to questions about the legality of the practice and the threats it brings to the integrity of the sport. The NCAA asked the CFTC to suspend prediction markets’ activities related to collegiate sports while safeguards such as integrity guardrails, age and advertising restrictions, anti-harassment measures, and others are hashed out. And the NFL, MLB, and PGA Tour are among the sports entities that prevent their players from endorsing and/or engaging with prediction markets.
While sports is the dominant force in prediction markets at the moment, it should be noted that other industries touching on the licensing business, notably entertainment, are also involved. The Golden Globes announced a partnership with Polymarket this month, for example.
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