DraftKings Eyeing Prediction Betting Opportunities Ahead Of Next Election

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Online sports wagering companies might not let another cycle of presidential election campaigning and wagering pass them by without taking some of that action themselves.


The massive quantity of wagering on this year's election was certainly hard to miss out on - and DraftKings Inc. now prepares on taking a long want to see if there are chances for itself in the prediction market business.


That is at least what DraftKings CEO Jason Robins said throughout the Boston-based company's Friday early morning conference call for experts and investors.


One analyst asked Robins for his thoughts on "non-sports wagering forecast markets" and whether there is an opportunity there for DraftKings.


"I believe it's an extremely interesting thing," Robins replied. "The marketplace within that that's dominant is election markets, of course, and particularly during governmental elections. So I know there's a lot of tension on it over the last few weeks. I do think there could be a place for it beyond elections, but that's truly where the interest seems to be now from a ... customer need side. So, definitely something we're looking at in advance of the next presidential election, and potentially it'll be an opportunity to take a look at something quicker."


RFK Jr.'s odds of a Cabinet nomination continue to fall


82% the other day, now 68% pic.twitter.com/ON61pv3Cqh


Robins included that it is a "various structure" for prediction markets, which offer wagerers the chance to bet on U.S. election odds, to name a few things.


Most especially, Kalshi, Robinhood, and others are controlled by the Commodity Futures Trading Commission, not state video gaming .


"It's not accredited as a wagering item, it's accredited as a monetary market," Robins stated. "It's absolutely a really various thing. So we'll need to see where it fits in the top priority list, however it is something we'll intend on taking a look at ahead of next election for sure."


There was substantial interest in wagering on the 2024 governmental election, to the tune of hundreds of millions of dollars staked at entities like Kalshi in the U.S. and Polymarket and Betfair abroad.


The comments from the CEO of one of the biggest online gambling business in the U.S. suggest sports betting and web casino betting operators have an interest in declaring a few of that service on their own.


That has the possible to shock the forecast market industry ahead of the next governmental election, and possibly even before. DraftKings, FanDuel, and other online gaming companies already have huge databases of wagerers, and might quickly steal market share from incumbents.


However, as Robins noted, forecast markets are managed differently, so DraftKings or other new entrants would have work to do before they might release their own versions. His comments likewise recommend that DraftKings does not expect states to loosen up their rules around election wagering anytime quickly.


Yes we could


Prediction markets offer agreements for specific results that gamblers can purchase, such as "yes" that one candidate will win an election. Bettors can purchase and offer these contracts until they are settled, as the costs fluctuate based on trading activity and the news.


For instance, somebody might have purchased a "yes" agreement for Donald Trump to win Tuesday's election for 60 cents. If they are still holding it, they stand to earn a profit of 40 cents, as the settlement worth of the agreements is usually $1.


This is different from sports betting, where users bet on point spreads, moneylines, and overalls. DraftKings took sports betting-style wagers on the U.S. election in the Canadian province of Ontario but was disallowed by state guidelines and policies from doing the very same in the U.S.


. That said, lots of sports bettors were most likely wagering on the 2024 election through Kalshi and other forecast markets. They could be quick to adopt a DraftKings-branded version.


A DraftKings prediction market would likewise fit in with the business's method of trying to ensure its consumers don't lack online betting choices.


The Boston-based bookie provides sports wagering, online casino gaming, horse-race betting, and, by means of its recent purchase of Jackpocket Inc., lotto tickets.


DraftKings states it "experienced the most customer-friendly stretch of NFL sport results we have actually ever seen early in the fourth quarter." pic.twitter.com/o70EkJRGde


The prediction-market business may help DraftKings and others smooth over the volatility of online sports betting as well, which stems from the truth that sometimes customers can win and win a lot.


That volatility was on complete display screen in third-quarter financial results reported by DraftKings on Thursday, as the company said "client friendly" NFL results in October and November have already forced it to modify its monetary projection for 2024.


DraftKings is now directing for earnings of between $4.85 billion and $4.95 billion this year, and adjusted EBITDA of $240 million to $280 million. The hard run of NFL results assisted minimize the profits estimate by $250 million and the changed EBITDA forecast by $120 million, the business said.

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