Kalshi’s coming
New York-based US prediction market leader Kalshi only made less than $2,000 on its NFL “build your combo” launch, but the debut of its same-game parlay (SGP) product has traditional sports betting investors running scared.
rollout ahead of two Monday Night Football matchups
According to reports, Kalshi’s SGP rollout ahead of two Monday Night Football matchups wiped a staggering $7bn off the market values of US sportsbook market leaders FanDuel and DraftKings.
Sportico Assistant Editor Dan Bernstein took to X with news of Kalshi’s live SGP market, sharing a screenshot of its odds for the Cincinnati Bengals vs. Denver Broncos game:
Equities markets are very much aware of the potential of Kalshi’s SGP product to offer significantly better odds than FanDuel and DraftKings, should it prove popular.
While the new SGP markets for Monday’s football, including on the Miami Dolphins and New York Jets game, only returned Kalshi $1,762.01 in fees, investors seem to have seen enough.
Bracing themselves
For both Monday games, Kalshi customers only traded $255,757 worth of SGP multi-variable contracts, meaning initial product uptake was quite minimal.
Investors know, however, Kalshi’s SGP debut only hints at its potential volume once bettors catch on. Kalshi also launched its new SGP product with zero promotion just hours before the Monday night games.
Even more ominously for FanDuel et al, Kalshi’s football SGP appeared unavailable once the Denver and Miami games started and was reportedly unavailable via Robinhood. The stock trading platform typically offers its customers access to Kalshi contracts, which, according to figures CEO Vlad Tenev announced Monday, are responsible for more than half of Robinhood’s volume.
DraftKings shares fell by as much as 12.1%
As a result, DraftKings shares fell by as much as 12.1% on Tuesday morning to $37.19. According to reports, the decline wiped $2.5bn off the Boston-based sportsbook’s market capitalization, with slippage since August knocking off $5.5bn off the company’s value.
FanDuel was also bleeding on Tuesday, losing as much as 11% to $252.09 and seeing $5.5bn wiped off its parent Flutter’s market value, which is now $10bn less than it was in late August.
Prediction markets laughing
The dramatic market reaction once again underlines the threat that the likes of Kalshi and Polymarket pose to traditional law-abiding, tax-paying sportsbooks.
No surprise then that the CEOs of both Kalshi and Polymarket were laughing at the first federally hosted roundtable on prediction market betting on Monday.
According to reports, the four-hour roundtable hosted by the Commodity Futures Trading Commission and the Securities Exchange Commission didn’t get down to discussing prediction market regulatory clarity as was hoped.
Instead, humor marked the meeting, with Kalshi’s Tarek Mansour, Polymarket’s Shayne Coplan, and CME’s Terrence Duffy all making jokes at their first roundtable with federal officials.
