Nevada Issues Warning to FanDuel Over Prediction Markets

Sports betting regulators from the Silver State continued their war against sports prediction markets this week.

The Nevada Gaming Commission (NGC) and the Nevada Gaming Control Board (NGCB) have both warned FanDuel Sportsbook over the impending launch of its new prediction market platform. The pair of regulators made it clear that it would take legal action if the operator decided to add a sports prediction market.

While FanDuel has stated that its initial offering will focus solely on US economic indicators, many believe it will soon expand into sports. The sports prediction industry offers operators the opportunity to offer wagers on sports without being subject to the stringent regulations and heavy taxes the sports betting industry is subjected to. That means companies like FanDuel can retain a larger portion of their profits while offering customers a more affordable way to wager on sports.

Nevada, which is the gambling capital of the US, has been standing up against the controversial new industry. They are currently embroiled in a legal battle with Kalshi, the leading prediction market in the US. While the lawsuit has yet to yield any results, Nevada is not afraid of opening another if FanDuel ignores the warnings of regulators. 

All Eyes on FanDuel

While Nevada is the first state to publicly warn FanDuel over its new prediction markets publicly, it won’t be the last. Dozens of states have expressed their opposition to the emerging industry. They have filed lawsuits, opened investigations, and sent letters in an attempt to protect their valuable sports betting markets.

FanDuel will now be facing a critical decision as the country watches over the coming months. If they decide to add markets for sports, it would be a massive blow to the sports betting industry. Relationships with state regulators and in-state partners will sour, likely causing a devastating impact for its sportsbook.

The money generated from the prediction market industry could compensate for the lost revenue, but the industry's future remains uncertain. With lawsuits from states and tribes continuing to mount, it could lead the US government to reconsider its support of sports prediction markets. If that happens, operators like FanDuel could find themselves in trouble.