Prediction markets grow as Kalshi eyes IPO; Knicks dent books

Three new entrants pushed into U.S. prediction markets this week as Kalshi reported rising revenue and New York sportsbooks posted a large weekly loss after the Knicks won the NBA title. Novig received approval to operate as a designated contract market and moved away from a sweepstakes model. ProphetX secured designated contract market and designated contract operator status and its exchange is live in all 50 states. Startup 365Predict, led by industry veteran Laila Mintas, announced plans to offer event-based trading.

The Commodity Futures Trading Commission’s existing rules allow event contracts tied to sports outcomes, enabling firms with DCM or DCO status to offer regulated event-contract trading. Companies that receive those approvals can list markets where users trade contracts tied to specific sporting results.

Kalshi reported roughly $2 billion in annualized revenue, about three times its level in November, driven by increased volume during major events such as the FIFA World Cup and the NBA Finals. The company has held preliminary discussions with investment banks about a potential initial public offering, with any listing likely more than a year away.

Polymarket and Splash Sports launched a nationwide NFL survivor contest with a $21 million prize pool. The contest requires a $1,000 entry fee and calls for two correct picks in eight specified weeks, with the final two weeks requiring a single pick. Organizers encouraged surviving entrants to use prediction markets to hedge part of their exposure.

New York’s online sportsbooks recorded a net mobile betting loss of $48,515,979 for the week ending June 14 after the Knicks clinched the NBA title. Statewide handle for the week rose 50.3% year over year to $587.58 million, while overall revenue swung to a negative $102.85 million, a decline of 189.3% from the prior year. Payouts tied to the U.S. men’s national soccer team’s World Cup opener also contributed to the period’s heavy liabilities.

In Illinois, a proposal to merge the Illinois Gaming Board and the Racing Board into a single Department of Gaming Regulation and Enforcement failed to advance. State Sen. Bill Cunningham raised concerns: “While the state could benefit from the consolidation of administrative functions, there was concern among legislators about the lack of transparency …”

A barn fire at the Saratoga Casino Hotel Harness Track in Saratoga Springs, New York, killed 17 horses and injured one. Officials said the barn had passed inspection but was exempt from certain fire prevention requirements including alarms and sprinklers, prompting renewed scrutiny of safety protocols at racing facilities.

Companies with DCM or DCO status are expanding product offerings ahead of the U.S. football season, when large pick’em and survivor contests typically attract high entry fees. Regulators and market participants continue to operate within the CFTC framework that permits event-based contracts.