Nevada Regulators Warn FanDuel About Prediction Market Plans

During Thursday’s Nevada Gaming Commission session, Commissioner Brian Krolicki pressed Flutter representatives to clarify their plansImage Source: Shutterstock.com

Nevada’s gaming regulatorshave voiced worries after FanDuel, a part of Flutter Entertainment, unveiled its intention to team up with CME Group, the biggest US derivatives exchange, to step into the prediction market arena. The partnership, made public earlier this week, seeks to create event-based contracts on subjects like stock changes, commodity prices, and even inflation, with plans to launch later this year.

Nevada Gaming Board Grills Flutter on New Betting Market Ideas

The proposed platform, under the Commodity Futures Trading Commission (CFTC) supervision, aims to let users make cheap predictions, starting at $1. These contracts differ from typical sports bets overseen by state gaming boards. Instead, they are seen as financial products, putting them in a murky legal spot in places like Nevada.

At Thursday’s Nevada Gaming Commission meeting, Commissioner Brian Krolickipushed Flutterrepresentatives to explain their plans. The company’s lawyer, Erica Okerberg, stressed that they had not settled on the exact types of contracts they might offer or where they could launch. She added that they are just looking into options and that their team in charge of following rules has been talking to regulators from the start, reported CDC Gaming.

Okerbergpointed out that CME’s track record in protecting consumers and being open about regulations made it a sensible choice to team up with. She promised the Commission that Flutterwould not start any projects that could put its Nevada licenses at risk, as these remain key to the company’s operations in the US.

Nevada Gaming Commission Points Out Legal Dangers in Flutter’s Prediction Market Ideas

Even with these promises, Krolickicautioned about ongoing legal clashes between federal regulators and Nevada authorities. The state is in a legal fight with Kalshi, another platform under CFTC supervision that offers sports-related contracts, over whether such products fall under Nevada’s gambling jurisdiction.

Krolicki warnedthat the clash between state and federal oversight is not resolved yet, stressing that any wrong move could endanger FanDuel’s Nevada license.

Okerbergstressedthat the company’s main goal is to protect its good relationship with state regulators. She confirmed they do not have any current deals with Kalshior other platforms. She said that if the company moves forward, it will do so in full alignment with state, federal, and local laws.

Commission Chair Jennifer Togliattijoked that Flutterseems keen on talking to state regulators instead of fighting in court. This comment made people laugh, but highlighted how serious the issue is.Right now, FanDuelis still researching and planning its prediction market ideas. Regulators have made it clear they will watch any future moves.