CME Holds the Majority Stake and Almost None of the Volume
Flutter Entertainment said Wednesday that all Fanduel Predicts sports and novelty contracts will move to Crypto.com’s exchange, with CME Group continuing to supply financial markets. “In coordination with CME, we have agreed that all Fanduel Predicts sports and novelties contracts will now be moved to Crypto.com,” chief executive Peter Jackson wrote in the company’s second-quarter earnings release, adding that the arrangement would let Fanduel ship products faster ahead of the NFL season.
CME is the majority owner of the business: its annual report for 2025 discloses a 51% equity interest in Fanduel Prediction Markets Holdings LLC, formed in December 2025 with $10.2 million in cash from CME, accounted for under the equity method. Sportico reported this week that the non-sports contracts CME retains represent under 1% of the app’s activity.
On CME’s own second-quarter call on July 22, chief executive Terry Duffy told Morgan Stanley analyst Michael Cyprys that “a lot of these prediction markets on sports are gambling,” that he expects the question to reach the Supreme Court, and that contracts are open to manipulation when exchanges list small parlays, according to the call transcript. He also questioned the practice of operators running market-making arms on venues where they hold a financial stake. Neither Fanduel nor Flutter was named on that call.
Flutter’s guidance discloses Q2 market-making revenue of $6 million and expects roughly $50 million in both revenue and adjusted EBITDA benefit for 2026, implying full flow-through. Jackson said Flutter is positioned to provide liquidity for combination markets across prediction platforms at low incremental cost. Flutter began providing liquidity on a third-party exchange in April, before building its own.
Flutter states that Fanduel Predicts revenue in the quarter was not material, that second-half gross revenues will be offset by customer-acquisition costs before rising in 2027, and that operational progress in the first half was slower than planned. Against a full-year Predicts investment Flutter has previously put at about $300 million, the $50 million market-making line is the return so far. U.S. adjusted EBITDA fell 70% to $119 million, which the company attributes partly to prediction-market spending.
Under the June 10 partnership announcement, North American Derivatives Exchange, Inc. trades as both OG Prediction Markets and Crypto.com Derivatives North America, and is registered with the Commodity Futures Trading Commission as a designated contract market and derivatives clearing organization. The same Crypto.com unit sought federal preemption cover in July as states moved against sports event contracts. Customer accounts sit with Fanduel Prediction Markets LLC, a registered futures commission merchant, which is the same CME-majority-owned entity. Financial contracts are available in all 50 states; sports and entertainment contracts only where Fanduel does not run a sportsbook.
Rival Draftkings solved the ownership problem by buying its way out, launching the proprietary DKeX exchange on June 26, dropping both CME and Crypto.com, and using a CFTC license acquired with Railbird Technologies in October 2025. DKeX now lists sports event contracts in 18 states. Fanduel appears to want the same position: in April it registered a new entity, New Ventures III, with the National Futures Association as a futures commission merchant, without CME. Flutter has not linked that filing to this week’s announcement, and it remains unconfirmed whether the two are related.
Jackson is leaving. Flutter said Dan Taylor, promoted to group president in May after Fanduel’s own leadership change, becomes chief executive on October 1. The same release cut U.S. revenue guidance by $395 million and adjusted EBITDA guidance by $210 million, and reported a $296 million net loss. Shares closed Wednesday at $92.91, down 11.5%.
CME’s own event-contract business is compounding. On the July call, chief financial officer Lynne Fitzpatrick said the exchange has handled roughly 525 million event contracts since launch, that more than 140,000 accounts traded them during the quarter, up about 13% from the prior three months, and that average daily volume passed four million contracts, up roughly 40%. The venue Flutter is moving away from is the one growing fastest inside CME.
