Crypto.com to Power Underdog’s Prediction Markets Foray

Fantasy and sports betting specialist Underdog has unveiled a new partnership with Crypto.com, a Singapore-based cryptocurrency exchange company. Thanks to the new partnership, Underdog will make a foray into the fast-growing prediction markets space.

Underdog to Hop on the Prediction Markets Train

Prediction markets are a fairly novel form of gaming that pairs trading stocks with sports wagering and allows players to buy and sell shares in the outcome of an event. What makes them so popular is the fact that players can wager on all kinds of events, including sports, politics, legal decisions, and even the papal elections.

Despite some pushback against the sector, prediction markets have experienced rapid growth. Underdog is therefore capitalizing on this trend while it’s hot, preparing to challenge giants, such as Kalshi and Robinhood. As one of the forerunners in the sports events contracts space, Crypto.com will provide Underdog with the edge it needs to achieve fast penetration.

Under the partnership with Crypto.com, Underdog will launch prediction markets in 16 states, targeting primarily jurisdictions where sports betting isn’t regulated yet. Unlike sports betting operators, prediction markets operate under the jurisdiction of the Commodity Futures Trading Commission (CFTC), which has been a cause for some dissent among the traditional betting industry.

For context, Underdog’s prediction markets platform will be powered by Crypto.com Derivatives North America (CDNA), which is already registered with the CFTC.

Underdog Is Bullish on Prediction Markets

During CNBC’s Worldwide Exchange on Tuesday, Jeremy Levine, Underdog’s founder and chief executive officer, lauded prediction markets as one of the most thrilling developments in a long time. Levine noted that this new form of gaming proves that the sector is still evolving.

Despite the popularity of political markets, Levine believes that the future of prediction markets will be about sports. Convinced that “no one does sports better than Underdog,” the CEO expressed excitement about his company’s foray into the prediction markets space.

Prediction Markets Under Scrutiny

Meanwhile, experts believe that prediction markets’ share of revenue will continue to grow. Some believe that this new form of gaming could generate $555 million in revenue in 2025 alone. While this figure is significantly lower than the revenue of the traditional betting industry, some commercial and tribal sportsbooks are already concerned.

Various state regulators have therefore opposed the prediction markets model, just like they have opposed sweepstakes and other betting and gaming alternatives. Some states have sent cease-and-desist orders to prediction market operators, while others have tried to convince the CFTC that this new model sets a dangerous precedent.

One of the main arguments against prediction markets is that they create unfair market conditions since they do not have to navigate the same complex regulatory landscape as commercial and tribal sportsbooks.