US sports company Fanatics is making a major move into prediction markets, a financial sector that has exploded in popularity over the past year as traders bet on everything from elections to inflation and sports.
On Monday, the sports retailer announced it had agreed to acquire Water Street Labs and CX Clearinghouse from BGC Group, giving Fanatics ownership of a federally regulated exchange and clearinghouse that allows it to launch and settle its own prediction market contracts. Financial terms were not disclosed.
With the acquisition, Fanatics will be able to list and close deals itself, giving it more control over the products it offers and how quickly it can bring new markets online. Fanatics and BGC also plan to develop new market data products combining market forecasting activity with traditional financial data, the companies said.
Prediction markets have become one of the fastest growing areas of finance, with much of that growth fueled by the CFTC-regulated Kalshi exchange and powerhouse Polymarket, which runs its operations on a blockchain.
