Fanatics eyes prediction markets in Crypto.com partnership

According to Financial Times News, sports merchandising giant Fanatics is in early-stage talks with Crypto.com to launch a prediction markets platform. The partnership would let customers bet on sports, politics, and pop culture outcomes through event contracts that pay out when specific events occur. This comes as Fanatics continues its global expansion, having recently opened a flagship London store in April and made pushes into sports betting and collectibles. The talks emerge alongside Flutter’s announcement that it’s partnering with CME Group for its own prediction markets platform. Fanatics, led by Michael Rubin, last raised $700 million at a $31 billion valuation in December 2022 and counts major sports leagues like the NFL, NHL, and MLB as shareholders.

Sports betting gets smarter

Here’s the thing about prediction markets – they’re basically the next evolution beyond traditional sports betting. Instead of just picking winners and losers, you’re betting on specific outcomes like “Will Taylor Swift announce a new album before July?” or “Which candidate will win the Iowa caucuses?” Companies like Polymarket and Kalshi have shown there’s massive demand for this stuff. And now the big players are taking notice.

Why this matters now

Look, Fanatics already has relationships with every major sports league in the US. They’ve got the trading card business through Topps, the apparel through Mitchell & Ness, and now they’re building out the gambling side. Prediction markets represent a huge opportunity because they appeal to a different crowd than traditional sports bettors. It’s more about current events and pop culture – things that get people talking every day rather than just during game days. And with Crypto.com’s existing infrastructure for event contracts through their regulated exchange, Fanatics gets to skip a lot of the technical heavy lifting.

The bigger picture

What’s really interesting is how this fits into Fanatics’ broader strategy. Michael Rubin isn’t just building a merchandise company – he’s creating a sports ecosystem. You’ve got merchandise, trading cards, events, traditional betting, and now potentially prediction markets. It’s all about capturing more of the fan experience and wallet. And honestly, it’s smart. Why just sell someone a jersey when you can also get them betting on whether their team will make the playoffs?

Regulatory landscape

But here’s the catch – prediction markets exist in a regulatory gray area in the US. While traditional sports betting has been largely legalized state by state, prediction markets covering politics and other non-sports events face more scrutiny. That’s probably why Fanatics is partnering with Crypto.com, which already operates a regulated exchange and clearing house for these types of contracts. Still, navigating different state regulations will be challenging. Basically, they’re walking into a minefield, but the potential rewards are massive if they can figure it out.