Fanatics Considers Crypto.com Partnership to Enter Prediction Markets
Fanatics, the global sports merchandising and collectibles group, is reportedly in talks to partner with Crypto.com to enter the rapidly expanding prediction market sector, Financial Times reports. The potential move would give Fanatics exposure to a market where customers wager on sports, politics, and pop culture events. This news comes as prediction platforms like Polymarket and Kalshi see soaring valuations.
Partnership Targets High-Growth Sector
Fanatics, based in the U.S., is exploring an alliance with Singapore-based Crypto.com. The planned partnership would allow Fanatics to capitalize on a sector that has seen dramatic growth in the past year. Prediction markets use “event contracts,” financial instruments that pay out when a specified outcome occurs.
Crypto.com has experience in this area, offering event contracts through its regulated exchange and clearing house. The firm recently announced similar partnerships with other online platforms.
Sources told the Financial Times that the plans for the partnership are in their early stages and could still change. Both Fanatics and Crypto.com declined to comment on the matter.
The move aligns with the larger business strategy of Fanatics’ leader, Michael Rubin. Rubin has prioritized betting and gaming within his expanding sports empire, which already covers merchandise, trading cards, and events.
Regulatory Shift
The interest from Fanatics reflects a broader industry trend. The rise of prediction markets has forced established gambling companies to rethink their business models in the regulated U.S. landscape.
For instance, competitors like DraftKings and FanDuel have already secured their positions in the space. DraftKings acquired the CFTC-regulated Railbird Exchange, and FanDuel announced a partnership with the CME Group to launch FanDuel Predicts.
Prediction markets are regulated at the federal level by the Commodity Futures Trading Commission (CFTC). The federal oversight allows them to potentially bypass stricter state-by-state gaming laws. This regulatory framework has been a major point of contention between state gaming bodies and prediction market operators.
Fanatics had previously been cautious about entering this market, citing the need to respect the state-regulated structure where its sportsbook operates.
However, recent developments, including a no-action letter from the CFTC for a competitor and court wins for Kalshi, suggest a shift in the regulatory climate. This change in market clarity likely prompted Fanatics to reconsider its stance.
Fanatics has deep ties to major U.S. sports leagues, including the NFL, NHL, and MLB, all of which are Fanatics shareholders. By partnering with Crypto.com, Fanatics would leverage an established, federally licensed infrastructure. This approach would help Fanatics Betting & Gaming gain exposure to the growing market while relying on Crypto.com’s compliance framework to mitigate regulatory risk in the U.S.
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