Analyst Squashes Fearmongering about Prediction Markets Killing Sports Betting

Under the onslaught of prediction markets, trade groups, operators, and analysts have all raised concerns about the future of the traditional sports betting business model.

Prediction Markets Not Here to Kill Sportsbooks

Regulators are suing prediction markets and accusing them of masquerading as financial products when they tend to emulate sports betting. According to at least one analyst, Fidelity Portfolio Manager Peter Beliste, the idea that prediction markets would just kill the sportsbook model is “simplistic.” 

“In 2026 and beyond, I think it will become increasingly clear that prediction markets are not displacing sportsbooks – and there may be some eventual legal challenges anyway – all of which sets up well for reversing this negative narrative,” he explained, with his own company, Fidelity Select Leisure, holding DraftKings stock. 

This doesn’t mean that all companies are on equal footing, as established ones such as DraftKings and FanDuel are likely to stave off the challenge from prediction markets better, not least because they have been actively seeking to gain a foothold in the vertical and have done so already. 

Companies with Large Footprints in Online Gambling Have an Easier Time

However, others, such as Penn Entertainment, Wynn Resorts, and so on, will have a much harder time. Belisle thinks that the result of all of this will be reduced promotional spending, which should push up profitability for the leading companies. 

Despite the currency dynamics, Belisle is disinclined to believe that a clear duopoly by FanDuel and DraftKings has been established in a sense that will define the long-term outlook or that the sports betting market has reached maturity – there is a long way to go.