Can a Sportsbook Offer Event Contracts or Prediction Markets in 2026?

Yes, a sportsbook can offer event contracts, but in the US the route and the state decide how. Event contracts trade on CFTC-registered exchanges, so a sportsbook usually reaches them through a partner exchange and a separate prediction markets product rather than its sportsbook licence.

The harder question is state law. In November 2026, federal appeals courts let New York, Connecticut and Nevada keep enforcing state gaming law against sports event contracts while appeals continue, and gaming regulators in states including Nevada, Arizona and Ohio have warned licensed sportsbooks that getting involved in prediction markets could put their licences at risk.

The CFTC says it has exclusive jurisdiction and has sued ten states to defend it. Outside the US, each regulator decides how event contracts are classified, so the answer depends on the market.

How do sportsbooks offer prediction markets today?

The large US sportsbooks that offer prediction markets run them as products separate from their licensed sportsbooks. The main routes differ in what is offered, where, and which regulator’s view matters most.

In the US, FanDuel’s prediction markets product shows the second route: by January 2026 it was live in all 50 states, partnered with CME Group, with sports contracts offered only in states where its sportsbook did not hold a licence and not on tribal lands, according to SBC Americas.

What is the legal state of play for sports event contracts in the US?

Federal and state regulators disagree about who governs sports event contracts, and the courts have not settled it. As of November 2026:

• The CFTC claims exclusive jurisdiction. On October 27, 2026, it sued Utah to stop the state enforcing its laws against CFTC-registered exchanges, saying federal law preempts state law. The Block counts it as the CFTC’s tenth suit against a state, after Arizona, Connecticut, Illinois, New York, Wisconsin, Minnesota, Rhode Island, New Mexico and Kentucky.
• Appeals courts have let states enforce while appeals run. On November 3, 2026, the Second Circuit denied requests to stop New York and Connecticut from enforcing state gaming law against sports event contracts during the appeals. The Ninth Circuit also declined to rehear a ruling that lets Nevada regulators pursue enforcement.
• State regulators are warning licensees. Gaming regulators in Nevada, Arizona, Ohio and other states have told licensed sportsbook operators that involvement in prediction markets, even outside their state, could put their licences at risk, according to InGame.
• The Supreme Court is the likely end point. Industry coverage, including WSN, expects the Supreme Court to decide whether states can regulate sports event contracts. Until then, the appeals court rulings stand.

For a sportsbook, the practical point is that a federal exchange partner does not remove state risk. Every state where you hold a licence is a separate question, and the answer can change within weeks. Take legal advice for each market before you go live.

What does a sportsbook need to control before adding prediction markets?

Settle five decisions before going live:

1. Categories by market: which contract categories (sports, finance, economics, culture, politics) are switched on in each jurisdiction, based on what each licence allows.
2. Geography: which states, countries and tribal lands are blocked, and how location is checked at sign-up and at each session.
3. Separation from the sportsbook: whether prediction markets run as a separate product, brand or entity, and how player accounts and wallets relate to the licensed sportsbook.
4. Liquidity and hedging: where prices come from, how positions are hedged, and what happens when a category is switched off in one market.
5. Integrity and monitoring: how insider trading and manipulation are detected, since regulators and lawmakers are now asking prediction market operators about both.

How does Shift Markets help sportsbooks add prediction markets?

Shift Markets offers a branded prediction markets module that sportsbooks and casino operators can add as a new product vertical for existing players, filtered to what each licence allows. The module includes:

• Category filtering for regulatory scope, so each market only shows the categories its licence covers.
• Aggregated liquidity from Polymarket, leading venues and custom markets.
• STP or B-book hedging, set by the operator.
• An operator Back Office, so the operator runs the product day to day.

Shift Markets, founded in 2009 in New York City, has powered more than 250 exchanges and brokerages, with over $2 trillion in total volume traded and more than 10 million registered end users on its platform. Operators go live in weeks, not months.

Shift Markets provides the technology, not legal advice. Each operator stays responsible for its own licences and for deciding which markets and categories to offer.

Bottom Line

A sportsbook can add prediction markets, but in the US the state, not the exchange partner, decides the risk. Settle categories, geography and separation from the sportsbook first, and re-check the legal picture before going live.

To see how a prediction markets module fits your licences, reach out to our team to request a demo.