Key Moments:
- Fanatics launched Fanatics Markets on 3 December 2025. It left the American Gaming Association (AGA) one week later.
- Fanatics, FanDuel, and DraftKings all left the AGA over disputes about prediction markets.
- The AGA warned that prediction markets bypass state regulation, reduce tax compliance, and weaken consumer protections.
Fanatics Launches Prediction Market Platform and Leaves AGA
Fanatics introduced its new prediction-market platform, Fanatics Markets, on 3 December 2025. Within a week, the company exited the American Gaming Association (AGA). This followed similar exits by FanDuel and DraftKings in November. Fanatics cited ongoing disagreements with the AGA over prediction markets. The AGA publicly confirmed the split.
On Fanatics Markets, users trade event contracts tied to real-world outcomes. Prices reflect the probability of each outcome. These contracts can be bought or sold before settlement. The system works more like a financial exchange than a traditional sportsbook with fixed odds.
Regulatory Landscape: State vs. Federal Oversight
Fanatics expanded its footprint by acquiring Paragon Global Markets. This gave it access to CFTC-registered infrastructure. The registration allowed Fanatics to operate nationwide and enter states without legal sportsbooks. Operators argue that CFTC oversight provides a consistent regulatory framework across the country.
The AGA disagrees. It argues that this model lets companies avoid state gambling rules, tax obligations, and consumer-protection requirements. The group says this undermines local laws, reduces revenue, and weakens accountability.
Recent Exits and Industry Divisions
FanDuel and DraftKings left the AGA on 18 and 19 November 2025. Both departures stemmed from disputes over prediction markets and sports event contracts. Their exits highlighted growing divisions in the U.S. gaming industry. Fanatics later joined this trend. The AGA warned that shifting to federal oversight could harm state revenue and reduce consumer protections offered by sportsbook regulations.
Prediction markets continue to grow in popularity. They give major operators access to federally supervised platforms, even in states where sports betting is illegal. These markets attract casual users with simple Yes/No contracts and offer operators valuable engagement data.
AGA’s Stance and Impacted Stakeholders
The AGA argues that prediction-market contracts fall outside state gambling laws. It says they threaten integrity standards, responsible-gaming commitments, and tax agreements with state and tribal partners. The organization has pointed to projected revenue losses discussed in recent legislative sessions, including at NCLGS. It continues to urge lawmakers to block further federal expansion in this area. The AGA maintains that state oversight should remain the core of sports-betting regulation.
Market Dynamics and Corporate Strategies
Major companies with large land-based operations—such as Caesars, MGM Resorts International, and PENN Entertainment—have avoided prediction markets tied to sports. A federal model could complicate their commitments to state licensing, tax agreements, and responsible-gaming programs.
Despite some companies leaving the AGA, collaboration continues through the Sports Betting Alliance (SBA). The SBA includes operators such as bet365 and BetMGM. It recently appointed a former senior AGA executive to a leadership position, signaling a shift toward digital products and federal regulatory issues.
| Company | Action | Date of Exit | Main Reason |
|---|---|---|---|
| Fanatics | Launched Fanatics Markets; left AGA | December 2025 | Disagreement over prediction markets |
| FanDuel | Left AGA | 18 November 2025 | Disagreement over prediction markets |
| DraftKings | Left AGA | 19 November 2025 | Disagreement over prediction markets |
- Author
Daniel Williams
