DraftKings Acquires Railbird Technologies, Will Launch DraftKings Predictions

• DraftKings today announced the acquisition of Railbird Technologies Inc, a federally licensed exchange designated by the CFTC
• The acquisition will support DraftKings’ strategy to enter the prediction markets and launch DraftKings Predictions
• DraftKings Predictions will debut in the coming months

DraftKings is making its intentions in the prediction markets known.

DraftKings today announced the acquisition of Railbird Technologies Inc, a federally licensed exchange designated by the Commodity Futures Trading Commission. This also includes its wholly owned subsidiary, Railbird Exchange, LLC.

The acquisition signals DraftKings intent to enter the prediction markets space, as it plans to launch DraftKings Predictions in the next several months.

Making Moves into Prediction Markets

The acquisition, according to the company, will expand its addressable opportunities through regulated event contracts.

“We are excited about the additional opportunity that prediction markets could represent for our business,” said Jason Robins, CEO and Co-Founder of DraftKings. “We believe that Railbird’s team and platform—combined with DraftKings’ scale, trusted brand, and proven expertise in mobile-first products—positions us to win in this incremental space.”

DraftKings also confirmed plans to launch DraftKings Predictions, a new mobile application to allow customers to trade regulated event contracts on real-world outcomes across finance, culture, and entertainment.

While sports event contracts are not specifically addressed, the company noted in its announcement that its “offerings may expand into additional categories over time, deepening customer engagement and extending DraftKings’ addressable audience.”

“This is a transformational moment for our company, and we are thrilled to be a part of the future of DraftKings,” said Miles Saffran, CEO and Co-Founder of Railbird. “DraftKings’ scale and leadership in the industry creates meaningful opportunities for our team and platform.”

What Might This Mean for DraftKings Gaming Licenses?

If DraftKings eventually does offer sports event contracts to its customers, it may put several of its sports betting and iGaming licenses at risk. Several state gaming commissions have warned operators to not offer sports event contracts or partner with companies that do.

Both the Michigan Gaming Control Board and Ohio Casino Control Commission have recently warned its license holders to not engage in the markets.

The Michigan Gaming Control Board sent letters to licensed operators earlier this month warning them that any participation in the market would play into the board’s decision for future licensure in the state.

“The Michigan Gaming Control Board understands that certain licensees may be considering opportunities to operate, offer, or facilitate access to prediction markets, where individuals can buy, sell, and trade event contracts that are based on a future event, occurrence, or value. The MGCB further understands that many of these prediction markets would offer sporting event contracts – event contracts in which an individual acquires a position on the outcome of a sporting event or other occurrence related to a sporting event – and would not operate in accordance with state gaming laws or pursuant to state-issued gaming licenses,” Henry Williams, Executive Director of the Michigan Gaming Control Board, wrote.

The Ohio Casino Control Commission sent similar letters to its operators, which led prediction market company Kalshi to file a lawsuit against the commission and the Ohio Attorney General.

Arizona and Nevada regulatory gaming bodies have also sent similar letters to gaming operators.