DraftKings Gains Federal Clearance For Predictions

DraftKings has taken a major step toward launching its DraftKings Predictions platform after securing federal approval to operate inside regulated event markets. Momentum in the prediction sector continues to build, and the company is now cleared to participate at the national level.

Good to Know

• DraftKings unit Gus III LLC is now an approved NFA member and swap firm
• Approval allows the firm to act as an introducing broker in derivatives-style markets
• Railbird acquisition gives DraftKings access to a licensed contract market

Gus III LLC received NFA and CFTC approval on December 4. The designations give DraftKings authority to handle event-based derivatives and route orders across regulated exchanges. A spokesperson said:

“This registration marks an important step in the company’s federally regulated operations and supports the upcoming launch of DraftKings Predictions.”

Expanding beyond traditional betting

The approval lets DraftKings explore yes-or-no style contracts tied to finance, culture and entertainment. The company already bought Railbird Technologies, a licensed DCM, to support future trading infrastructure. Railbird is inactive, and the deal terms were not disclosed.

Competition is building fast. Fanatics entered the space this month through its acquisition of IB-licensed Paragon Global Markets. Polymarket, Kalshi, Underdog, PrizePicks, Novig and Truth Predict are also pushing for growth. Kalshi hit about $4.4 billion in October trading, while Polymarket saw user activity rebound.

Key regulatory considerations

DraftKings has not confirmed whether sports-themed markets will be included. State regulators often restrict operators from running both sportsbooks and federally regulated exchanges, which may limit crossover.

CEO Jason Robins said the company is “excited about the additional opportunity that prediction markets could represent for our business” and is exploring options as rules evolve. He added in October that he “just doesn’t see a world” where users prefer independent exchanges over established sportsbooks in regulated states.

Filing history and go-to-market moves

The approval concludes a process that began in 2024, paused, and restarted in 2025 under Gus III Holdings LLC, with Robins, Alan Ellingson and Paul Liberman listed in the filing. DraftKings also withdrew a separate application in April, describing prediction markets as an “emerging product that warrants thoughtful consideration.”