As event contracts continue to gain traction in the sports, finance, and crypto sectors, prediction markets are attracting more platforms to increase their investment. Sports retailer Fanatics has agreed to acquire Water Street Labs and CX Clearinghouse, both owned by BGC Group, thereby gaining access to a U.S. federally regulated trading and clearing infrastructure.

Following this transaction, Fanatics will be able to list and liquidate prediction market contracts independently, no longer relying solely on external infrastructure. The transaction amount has not yet been disclosed. For the company, the core change lies in increased autonomy in product launch timing and contract design.

Gain your own listing and liquidation capabilities

Fanatics had previously launched the Markets platform, offering users event-driven contract trading. Following the acquisition, the company will directly control exchange and clearinghouse resources, meaning it can launch new markets more quickly and participate more deeply in product operations.

The company also stated that Fanatics and BGC plan to develop new market data products that combine predictive market trading activity with traditional financial market data to expand their data service capabilities.

Market competition is expected to continue to intensify.

Over the past year, prediction markets have emerged as one of the fastest-growing segments in the financial sector. Kalshi, regulated by the U.S. Commodity Futures Trading Commission, and Polymarket, operating on blockchain technology, are two of the most prominent representative platforms.

Crypto companies are also pushing this sector to a wider user base. Coinbase has partnered with Kalshi to bring prediction market products to users in all 50 US states. Robinhood has also started offering event contracts through the same exchange.

Sports betting platforms are also following suit.

Against this backdrop, Fanatics is attempting to leverage its massive sports user base to further expand the prediction market to the mass market. Its Markets platform launched at the end of 2024 and currently covers 23 U.S. states and 4 overseas territories.

Besides crypto and financial platforms, sports betting operators are also moving towards prediction markets. DraftKings announced late last year its plans to launch its own prediction market platform.

From an industry perspective, Fanatics' acquisition is not merely about acquiring additional licenses, but also about directly completing the transaction and clearing processes. As more platforms vie for event contract users, the focus of competition in the prediction market is shifting from single traffic entry points to infrastructure, compliance capabilities, and product launch speed.