DraftKings CEO says DKeX ranks third among US prediction market exchanges
Deals & M&A3 min read
DraftKings chief executive Jason Robins said DKeX has become the third-largest US prediction market exchange within months of its late-June launch. Aldrin Research data showed DKeX ranked third by notional trading volume in the week to 18 October, with $1.04bn traded and a 3.57% share. Robins said the platform operates with a more limited state footprint than rivals.
Jason Robins, who co-founded DraftKings and serves as its chief executive, told attendees that DKeX has risen to the No. 3 position among prediction market operators in the US. The in-house exchange only went live in late June, he noted. Robins gave his comments in a Q&A with Contessa Brewer of CNBC, held Thursday at the NEXTPredict Summit in New York City.
Figures compiled by Aldrin Research back up that position. For the week closing 18 October, DKeX took third spot by notional trading volume, recording $1.04 billion in trades. Its share of the market stood at 3.57%, compared with 2.33% in the week that closed 26 September. Kalshi was a clear leader, and Polymarket came in a relatively distant second.
DraftKings Predictions is live in 38 states, yet the complete range of event contracts it offers reaches just 18 of them, among them California, Florida and Texas. Where the company runs traditional sports wagering, as in Colorado, New York and Pennsylvania, customers can access financial event contracts only, since DraftKings steers clear of sports event contracts in those markets. Marketing for DraftKings Predictions nonetheless runs across all 50 states as part of its "super app" strategy, with the products on offer differing from state to state. Nevada customers, for instance, get free-to-play sports contests and nothing more.
According to Robins, DraftKings has kept its state presence narrower than that of the rivals it competes with. He conceded that offering sports contracts in a state such as New York would raise the company's profile. Still, he argued that the other path carried a cost: "The alternative was we would have had our licenses under threat , and I think that wouldn't have been a smart move."
Legal challenges to sports-related event contracts are moving closer to a US Supreme Court ruling, according to the report. Robins said some companies have staked a lot on one outcome, while DraftKings considers itself positioned for either result. He added that growth in non-sports markets, including financial contracts, had been a positive surprise and could remain viable if courts eliminate sports event contracts.
DraftKings shares have fallen more than 40% this year amid the growth of prediction markets. Robins attributed investor concern to uncertainty over the federally regulated exchange business rather than to competition with state-regulated sportsbooks.
Questions about DraftKings' artificial intelligence use and its responsible gambling record, raised after recent negative coverage, also drew a response from Robins. According to him, the company's approach is the reverse of targeting problem gamblers, who are instead directed to a specialized team. On the Seminole Tribe's recent Florida lawsuit against him and the company, Robins offered little. He said he found it interesting that DraftKings was singled out, given that other prediction markets also operate in the state, but he could not speak to why.
“We only launched the DraftKings exchange a few months ago, and we're already the clear No. 3 , which is great, and we continue to gain share”