Recently, FanDuel and DraftKings announced their withdrawal from the regulated sports betting market in Nevada, shifting their focus to the prediction market business, a move that directly conflicts with the state gaming regulatory authorities. The Nevada Gaming Control Board has explicitly opposed the prediction market, warning that it constitutes illegal activity, while similar regulatory disputes have also emerged in other states, highlighting the challenges of expanding the prediction market nationwide.
Withdrawal Event and Strategic Shift
FanDuel has abandoned its sports betting license in Nevada, and DraftKings has withdrawn its license application, marking a complete exit from the state market by these two operators. The reason is that both companies have turned to launching prediction market products, such as the FanDuel Predicts program scheduled to launch in December, aimed at expanding into new markets through sports event contracts, such as in Texas and California.
Regulatory Authority Stance and Warnings
The Nevada Gaming Control Board states that the prediction market involving sports event contracts constitutes unapproved gambling activities, which are inconsistent with state gambling regulations. The Board has issued penalty warnings to licensed institutions and previously sent cease and desist notices to prediction market operators like Kalshi, leading to multiple lawsuits, emphasizing the state government's determination to maintain order in the gambling industry.
National Impact and Industry Dynamics
The controversy over the prediction market is not limited to Nevada, with regulatory authorities in Maryland, New York, and other places having filed lawsuits, and legal challenges also arising on tribal lands. Meanwhile, the prediction market continues to expand, with institutions like the National Hockey League in the US collaborating with Kalshi, and Google Finance including its data, but traditional gambling operators like Caesars Entertainment have not yet entered this field.
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