Fanatics yesterday (3 December) announced the launch of Fanatics Markets, a prediction market platform that has now begun its rollout across the US.
The launch marks another step in the company’s diversification beyond merchandise and traditional sports betting.
The move aims to position the company, recently valued at around $25bn, as a major competitor in the rapidly growing prediction market sector, challenging existing players like Kalshi and Polymarket.
Fanatics Markets is launching in two distinct phases. Phase One went live on Wednesday (3 December) in an initial 10 states, with the remaining states in the 24-state rollout scheduled to follow later.
The first states were Alaska, Delaware, Hawaii, Idaho, Maine, New Hampshire, North Dakota, Rhode Island, South Dakota, and Utah.
Next to be added are Alabama, California, Florida, Georgia, Minnesota, Mississippi, Nebraska, New Mexico, Oklahoma, Oregon, South Carolina, Texas, and Washington.
Fanatics only said it would launch in those latter states “soon.”
The platform allows users to trade event contracts across a variety of outcomes, including sports, finance, economics, and politics.
Fanatics plans for Phase Two, scheduled for early next year, to expand its markets to include event contracts related to crypto, stocks/IPOs, climate, pop culture, tech/AI, movies, and music.
The new venture is facilitated through a strategic partnership with Crypto.com | Derivatives North America (CDNA), a Commodity Futures Trading Commission (CFTC)-registered exchange and clearinghouse.
CDNA will provide the underlying markets and pricing data, while Fanatics will maintain full control over the user experience and interface of the Fanatics Markets app, which is available on iOS and Android.
Fanatics also bolstered its regulatory standing in July 2025 by acquiring Paragon Global Markets, LLC, a federally registered introducing broker with the CFTC.
Targeting untapped markets amid regulatory scrutiny
The launch confirms previous indications from Fanatics CEO Michael Rubin, who said in November that the company planned to introduce a prediction market platform in the coming weeks.
The venture allows Fanatics to offer a form of event-based trading in large, commercially significant states such as California, Texas, and Florida.
This reflects the plans of other sportsbooks that are looking at jurisdictions where their traditional online sports betting products are not yet legally available.
The strategy capitalises on a regulatory distinction that allows prediction markets, regulated by the CFTC as derivatives exchanges, to operate in a broader swath of the US compared to state-regulated sports betting.
However, this regulatory environment remains contentious.
While pioneers like Kalshi and Polymarket have seen their valuations soar, they continue to face pushback and legal scrutiny from various state gambling regulators who argue that sports event contracts constitute unregulated wagering.
Kalshi was recently valued at $11bn after a $1bn funding round, underscoring investor confidence in the sector’s long-term potential despite the legal ambiguity.
Fanatics’ entry with a federally-regulated, diversified market offering pits it directly against the prediction market duopoly while also allowing it to leverage its extensive customer base and brand ecosystem across merchandise, collectibles, and gaming.
The company’s gaming division is already aggressive, with Michael Rubin having projected that the segment could account for 40% of Fanatics’ profits by 2027.