Sportsbooks Are Writing Bigger Checks to Block Prediction Markets from Stealing Their Turf

For years, FanDuel and DraftKings had a relatively clean lane with sports leagues. They signed expensive exclusivity deals, planted their logos on LED boards, and locked up official data rights. Then prediction markets showed up — and the leagues started taking their calls, too.

Over the past several months, platforms like Polymarket and Kalshi have quietly assembled a roster of major league partnerships that would have been unthinkable eighteen months ago. The NHL signed first. Then the UFC, MLS, and finally Major League Baseball — in a deal that may be worth up to $300 million. Each new announcement sends a message to the traditional sportsbook industry: the leagues are not waiting for legal clarity. They are cashing checks from whoever is offering them, and the definition of a gaming partner is being rewritten in real time.

The response from FanDuel and DraftKings has not been to walk away. It has been to show up with larger numbers and broader contract language — pushing to expand exclusivity definitions before the prediction market category gets any more entrenched.

How the Leagues Started Building a New Category

The NHL was the first major North American professional sports league to move, announcing multi-year marketing agreements with both Kalshi and Polymarket in October 2025. The deals gave both platforms rights to use NHL marks and logos, access to official league data, and branding exposure on digital dashboards and virtual signage during high-profile broadcasts — including the Winter Classic and Stanley Cup Playoffs. NHL President of Business Keith Wachtel called the partnership a tremendous opportunity for the broadest fan engagement during the NHL season. Kalshi CEO Tarek Mansour was equally direct: it should be clear now that prediction markets are here to stay.

The UFC followed, signing its own deal with Polymarket. Then MLS made it official in January 2026, naming Polymarket its exclusive prediction market partner. MLS SVP of Emerging Ventures Chris Schlosser framed the decision around integrity. How do we ensure the integrity of matches and competition to the best of our ability, Schlosser told Front Office Sports. It became clear that the best way to do that was to lean in and partner with these guys to create an integrity framework that we felt was really needed.

The biggest deal came in March 2026, when Major League Baseball announced a multiyear exclusive partnership with Polymarket. MLB named the platform its Official Prediction Market Exchange, granting it access to team marks, logos, and official Sportradar data to resolve trades. Commissioner Rob Manfred simultaneously signed a memorandum of understanding with the Commodity Futures Trading Commission to establish a formal integrity framework. Financial terms were not fully disclosed, but sources told Front Office Sports the deal could be worth somewhere between $150 million and $300 million depending on performance benchmarks. MLB also announced it would treat prediction markets as its own sponsor category — entirely separate from sports betting — a distinction that carries enormous implications for the existing sportsbook deals already in place.

At this point, the only major holdouts are the NFL and NBA. Notably, the NFL sports betting sponsorship category has been open for the first time since 2021, after FanDuel and DraftKings declined to renew their previous contracts amid disputes over the rising cost of official data. Industry observers expect both leagues to have serious prediction market conversations before long.

Why Sportsbooks Are Scrambling to Rewrite the Rules

When FanDuel and DraftKings negotiated their original league deals, prediction markets were not part of the equation. The exclusivity language they secured covered sports betting — a category that, at the time, meant state-regulated sportsbooks. Polymarket and Kalshi operate under federal CFTC oversight rather than state gaming licenses, and that distinction has turned into a significant and expensive loophole.

The result is a situation sportsbooks are not comfortable accepting. FanDuel holds co-exclusive status as the Official Sports Betting Partner of MLB. Polymarket is now the Official Prediction Market of that same league. According to Marcus DiNitto of Gambling Insider, those prediction market deals are chipping away at the value of the ones held by sportsbooks. Two competing wagering products now sit side by side across the same fan base — and sportsbooks are paying for an exclusivity that no longer means what it used to.

Matt Foote, founder and CEO of sports betting consultancy VIG Partners and a former chief commercial officer at PointsBet, told Sports Business Journal that operators are now pushing hard to cover the prediction market category in every new or renegotiated deal they pursue. Of late, FanDuel and DraftKings have pushed hard to get predictions rolled into all their deals, Foote said, or at least to get a right of first refusal if a property breaks out the category, as MLB recently did in its exclusive deal with Polymarket. He was direct about what that ambition costs: I know how aggressive everybody is trying to be to cover the prediction market category in their deals.

Sports Business Journal reported in early April 2026 that sportsbook brands are now proactively engaging with their partners to broaden their rights and keep the emerging platforms at bay — and that it is going to cost the companies to protect their marketing rights. Both FanDuel and DraftKings have also launched standalone prediction market products of their own — FanDuel Predicts through a joint venture with CME Group, and DraftKings Predictions after acquiring CFTC-registered exchange Railbird Technologies. Both companies surrendered their Nevada gaming licenses in the process, a significant sacrifice that reflects how seriously they are taking the competitive threat.

The Bigger Picture: What Bettors and the Industry Should Watch

For bettors, the near-term story looks like more choice and more competition. Prediction market contracts now operate in all 50 states, not just the 38 or so where sports betting is legal. Kalshi recorded $331 million in trading volume in December 2025 alone, a monthly record. Polymarket is backed by the NYSE operator Intercontinental Exchange, which has committed up to $2 billion to the platform. Both Kalshi and Polymarket are currently in talks to raise additional capital at valuations approaching $20 billion. The money flowing into this sector is not speculative anymore — it is a direct challenge to a sportsbook industry worth hundreds of billions in annual handle.

The longer-term picture is more complicated. More than a dozen states are actively challenging prediction markets in court, arguing that event contracts on sports outcomes constitute sports betting and must be licensed accordingly. Arizona’s attorney general filed criminal charges against Kalshi in March 2026, calling the company an unlicensed bookmaker. Multiple states have warned sportsbook licensees that offering prediction products could jeopardize their regulated status. The CFTC, leagues, and state regulators are all pulling in different directions, and the legal questions may not be fully resolved for years.

What is clear is that no one in the industry believes this ends with prediction markets going away. The leagues are taking the money. The sportsbooks are paying more to stay relevant. And the prediction market platforms, flush with capital and a federal regulatory framework that states have so far been unable to dismantle, are not slowing down. Whoever owns the league relationships when the courts finally settle the question will be holding a serious competitive advantage — and both sides know it.