The acquisition will enable DraftKings to offer regulated event contracts, supporting its strategy to enter prediction markets, the company said in a Tuesday (Oct. 21) press release.
DraftKings also said in the release that it plans to launch a mobile app called DraftKings Predictions in the coming months. The app will allow customers to trade regulated event contracts on real-world outcomes in finance, culture, entertainment and, further in the future, potentially other categories, according to the release.
“We are excited about the additional opportunity that prediction markets could represent for our business,” DraftKings CEO and Co-Founder Jason Robins said in the release. “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.”
Railbird CEO and Co-Founder Miles Saffran said in the release: “DraftKings’ scale and leadership in the industry creates meaningful opportunities for our team and platform.”
Railbird was founded in 2021 and became a designated contract market by the CFTC in June, according to the company’s website.
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When announcing that approval in a post on LinkedIn, Saffran said: “A DCM license allows us to operate a regulated futures exchange in the U.S. In our case, we’re creating a market for event contracts, where people can trade on the outcomes of real-world questions.”
PYMNTS reported in August that a long-predicted U.S. boom in prediction markets may finally be arriving. Access had been legally constrained by the CFTC, which has traditionally taken a cautious view and kept commercial operators on short leash, but there are signs that this regulatory posture is beginning to change under the Trump administration.
During the same month, PYMNTS reported that with increased political interest in the prediction market space, DraftKings appeared to be positioning itself ahead of regulatory tailwinds.
In September, the CFTC issued a no-action letter regarding event contracts in response to a request from QCX, a designated contract market, and QC Clearing, a derivatives clearing organization, both owned by crypto-based prediction market platform Polymarket.
PYMNTS reported at the time that the CFTC’s no-action letter allows event contracts without triggering standard swap data reporting and recordkeeping mandates.
