Fanatics is buying a US-regulated exchange and clearinghouse, joining rival DraftKings in a push by betting companies to control more of the infrastructure behind their prediction market businesses.
Fanatics Buys Exchange as Sportsbooks Seek To Control Prediction Market Rails
27 July 2026 - 23:52 CEST
By Ana Pereira
The sports and merchandising group agreed to acquire Water Street Labs and CX Clearinghouse from BGC Group as part of a wider partnership between the companies, according to a 27 Jul statement. Financial terms were not disclosed.
Owning the exchange and clearinghouse could give Fanatics greater control over which markets it lists, how quickly it introduces products and how much of the revenue generated by trading remains within the group. "This deal allows us to own the full technology stack," a company spokesperson told Sandmark.
From partner to owner
Fanatics built its business selling licensed jerseys and other sports merchandise before expanding into trading cards and sports betting.
The company entered prediction markets in December through a different model, using another company's infrastructure rather than its own. Its customer-facing app, available in 23 US states, currently connects users to markets and pricing provided by Crypto.com's Derivatives North America exchange, known as CDNA. The arrangement allowed Fanatics to enter the sector without initially owning the infrastructure for event contracts trading.
Despite the acquisitions, the company said it will continue working with Crypto.com after the BGC transaction. Fanatics did not specify which contracts would be supplied by Crypto.com and which would eventually be listed on its own exchange.
A widening market
Prediction market platforms allow users to trade contracts tied to outcomes ranging from elections and economic data releases to sporting events.
The 2026 FIFA World Cup accelerated that shift, drawing millions of new users and billions of dollars in trading around the tournament. Kalshi's World Cup winner contract traded more than $1.2bn, while Polymarket's equivalent market recorded $4.28bn in volume.
Beyond sports contracts
The assets also give the company a route beyond retail sports contracts.
Fanatics and BGC said they plan to connect Fanatics' consumer audience to develop data products combining prediction-market sentiment with traditional financial-market information. BGC will contribute its institutional trading, liquidity, analytics and market-data expertise.
US sportsbook operator DraftKings has already taken a similar path. After acquiring Railbird Technologies in October, it launched its own prediction-market exchange, DKeX, in June and integrated it into the DraftKings app. The move gave DraftKings greater control over the contracts offered, the underlying technology and the economics of each trade.
DraftKings said its prediction-market platform generated $3.4bn in annualized consumer volume and $11.3bn in annualized total trading volume in the week ended 21 Jun.
