Fanatics is pushing deeper into prediction markets through an acquisition that gives it federally regulated market infrastructure. The company said Monday it has agreed to buy Water Street Labs and CX Clearinghouse from Nasdaq-listed brokerage firm BGC Group.
Deal includes exchange and clearing capabilities
Water Street Labs is a U.S. Commodity Futures Trading Commission-registered designated contract market, and CX Clearinghouse is a registered derivatives clearing organization. Terms of the transaction were not disclosed.
By owning both an exchange and a clearinghouse, Fanatics will be able to list and settle event contracts directly on Fanatics Markets, its prediction-markets subsidiary launched in December 2025, instead of routing trades through third parties.
Part of a broader industry rush
The move tracks a wider push across the sector. DraftKings and FanDuel each moved into CFTC-regulated event contracts around the turn of the year, drawn by a federal structure that allows them to reach sports fans in states such as California and Texas, where mobile sportsbooks are still not permitted.
DraftKings accelerated its entry by acquiring exchange operator Railbird. FanDuel, meanwhile, partnered with CME Group before both companies built out their own infrastructure. Control of the rails rather than renting access has become the standard industry approach described in the report.
Prediction market volumes keep climbing
The scramble reflects growing conviction around the category. Over the past year, crypto-native platform Polymarket and prediction market leader Kalshi have expanded quickly. Dune Analytics data cited in the report shows Kalshi alone posted $33 billion in trading volume in June.
Dune data also shows total prediction-market trading volume has reached $48 billion so far in July across Polymarket, Kalshi, and smaller venues including Limitless and Myriad. The report disclosed that Myriad is owned by Dastan, Decrypt's parent company.
Wall Street interest and long-term forecasts
Traditional finance firms are also entering the space. ICE, the parent company of the New York Stock Exchange, has invested $1.6 billion in Polymarket. Bernstein analysts project prediction-market volume will reach $1 trillion by 2030, with revenue rising to about $10.8 billion. They also expect institutions to expand trading activity beyond sports and into economic and political contracts.
Fanatics and BGC to work on data products
Alongside the acquisition, Fanatics and BGC said they will partner on market-data products that combine prediction-market sentiment with traditional financial data, linking retail and institutional participants.