DraftKings CEO Says DKeX Is Already the Third-Largest US Prediction Market Platform

DraftKings' dedicated prediction market platform, DKeX, may already be the third-largest in the United States, according to company CEO and co-founder Jason Robins. He made the remarks at the NEXTPredict Summit in New York City.

Robins said the company has moved into the top three exchanges in a short period, noting that it launched on DraftKings Exchange only a few months ago. "And we're already the clear number three, which is great, and we continue to gain share," he said, adding that becoming a relevant and rising player is bringing the business more attention.

The platform is not yet available everywhere the company offers sports betting. DKeX has a foothold in 18 jurisdictions, compared with the 38 states where DraftKings runs its sportsbook. The operator also has to move more carefully than legacy prediction market platforms, because offering sports event contracts could cause problems with gaming regulators. For that reason DKeX has so far focused mostly on financial contracts.

Robins recently said at SBC Summit Barcelona that DraftKings does not know whether prediction markets are here to stay or will fade, whether because of regulation or market forces, but that the company could not afford to stay out of the vertical. DraftKings is therefore approaching prediction markets as a supplementary product that could potentially scale over time, while avoiding legal challenges that might affect its core business.

The outlook remains uncertain. The prevailing view is that gaming regulators will keep challenging prediction market platforms until the Supreme Court of the United States rules on the issue. Even after that, it is unclear whether regulators could introduce restrictions preventing an entity from holding a licence if it runs both sports prediction markets and traditional sports betting. Robins acknowledged this at the summit and described the situation as a "win-win" for DraftKings regardless of how the legal dispute over prediction markets ends.