Fanatics Betting & Gaming walked away from its American Gaming Association membership this month. The operator launched Fanatics Markets on December 3, putting it in direct competition with established prediction markets platforms.
The AGA confirmed Fanatics ended its membership during the first week of December. But they didn’t say much else about it.
Fanatics isn’t alone here. DraftKings and FanDuel both quit the AGA on November 18. All three operators made the same call after getting into prediction markets this year.
Why This Split Happened Now
The AGA’s been pretty vocal about prediction markets. President Bill Miller says platforms like Kalshi and Polymarket operate outside the rules that states and tribal governments set up. Federal law too.
That’s the core issue. Traditional sportsbooks follow state-by-state licensing. They work with gaming commissions. Prediction markets use CFTC registration instead.
Fanatics bought Paragon Global Markets back in July. Paragon’s registered as an introducing broker with the CFTC. It’s also a National Futures Association member. So Fanatics Markets operates under federal commodity trading rules, not state gambling regulations.
The event contracts on Fanatics Markets come from Crypto.com/Derivatives North America. They’re a CFTC-registered exchange and clearinghouse.
What Fanatics Did After Launch
Fanatics Markets went live in 10 states initially. Two days later, they’d added 14 more states. That’s fast expansion by any measure.
FanDuel put out a statement when they left. They said they value industry partnerships. But expanding into prediction markets didn’t match the AGA’s priorities for member operators. DraftKings said something similar, their strategic plans don’t align with where the AGA’s headed.
DraftKings had announced they’re buying Railbird Technologies in October. Another prediction markets play.
How the Industry’s Changing
Three major operators leaving the same trade group in three weeks says something. The prediction markets business model doesn’t fit with traditional gaming association priorities.
Joe Maloney moved from the AGA to become President and CEO of the Sports Betting Alliance on December 11. He was SVP of Strategic Communications at the AGA. The timing’s interesting, and Kalshi just started a new prediction market trade association with Crypto.com. So operators who left one group might join another.
Fanatics also rolled out OpenBet’s Protect Suite across its US operations on December 9. That includes OpenBet Locator for geolocation and fraud prevention. Standard compliance stuff for a growing operator.
The split between traditional gaming associations and prediction markets operators looks pretty clear now. Different rules, different regulators, different trade groups.
