Twist in the Battle
The ongoing dispute over prediction markets has escalated this week as the Nevada Gaming Control Board (NGCB) took decisive measures against the leading US sports betting companies.
accepted FanDuel-owned Flutter’s “surrender”
On Wednesday, the NGCB announced that it had accepted the “surrender” of FanDuel-owned Flutter’s current Nevada license and approved DraftKings’ request to withdraw all pending applications.
This swift departure from Las Vegas by both companies followed the state’s ruling that their participation in prediction markets, known as Contracts for Difference (CFDs), was “unlawful” and incompatible with a Nevada gaming license.
Symbolic Significance
Nevada is among several states that have consistently advised companies like FanDuel and DraftKings to avoid prediction markets. The NGCB’s formal action on Wednesday reportedly occurred just before Flutter released its third-quarter financials, which included confirmation of plans to introduce CFDs-based FanDuel Predicts in non-regulated markets in December.
DraftKings plans to launch its own CFDs platform “in the coming months,” with both companies stating they will geofence all Indian Country in any states where their prediction markets are offered.
direct opposition to Nevada’s priorities”
A FanDuel spokesperson commented that the company’s goals for CFDs in unregulated states were “unfortunately in direct opposition to Nevada’s priorities for its licensed operators.”
While expressing regret over surrendering its Nevada license, Flutter CEO Peter Jackson stated that FanDuel was focusing on entering US markets it had not accessed through traditional sportsbooks, such as Texas, California, and Georgia.
DraftKings echoed this sentiment, stating its exit from Nevada was part of its “ongoing commitment to regulatory compliance.” Jen Aguiar, DraftKings’ Chief Compliance Officer, however, defended CFDs markets as being federally regulated and stated that DraftKings would collaborate with the federal body “to uphold the highest standards of integrity in our operations.”
Regulatory Roadmap?
The NGCB’s proactive stance against major US sportsbooks is viewed by industry insiders as setting a precedent for other regulated states to remove CFDs operators.
The situation in Nevada shifted earlier this month when US District Court Judge Andrew P. Gordon unexpectedly denied Crypto.com’s request for a preliminary injunction to offer sports event contracts, leading the crypto company to suspend its Nevada sports event contracts on Monday.
Nevada sent a clear message”
With major players DraftKings and FanDuel now restrained, InGame quoted an industry expert who believes other states might follow Nevada’s example. “Nevada sent a clear message to provide other regulators with a roadmap going forward. Hopefully, others will follow on this important issue to the regulated gaming market.”
- SCCG Management. The Gambling Industry’s Global Connector. Access Here.
- Source: SCCGManagement.com