American sports betting company DraftKings is teaming up with Polymarket to be the main partner for handling trades in its new prediction market, which has more than $4 billion in trades every month. “Congratulations to DraftKings for buying Railbird. We are happy that Polymarket Clearing will be the place to handle their trades as they start in the prediction market”, said Polymarket CEO Shayne Coplan in a post on X on Wednesday. Railbird is a prediction market platform that follows the rules set by the Commodity Futures Trading Commission, and DraftKings bought it for an undisclosed amount on Tuesday. Polymarket’s role as the clearinghouse is to check trades, manage deposits, and ensure that all bets or contracts are completed fairly and securely, which prevents problems, lowers risks, and builds trust among users. The new “DraftKings Predictions” app is set to launch in the coming months, featuring a variety of topics from finance and culture to entertainment. “This product will be flexible and connect to many exchanges, allowing DraftKings to provide a wide range of markets for its customers”, DraftKings stated.
This is DraftKings first big move into cryptocurrency since closing its non-fungible token marketplace in July 2024, and it strengthens Polymarket’s strong position in the prediction market. Polymarket got its clearinghouse by purchasing the US derivatives exchange QCEX for $112 million in June, marking its return to the US market after being absent for over two years. Polymarket has had a busy month with new additions, including Sam Altman’s identity-focused World App on Tuesday and crypto wallet MetaMask, which plans to integrate its service before the year ends. Intercontinental Exchange, which owns the New York Stock Exchange, invested $2 billion in Polymarket, raising the company’s value to $9 billion as competition increases with Kalshi, which is also valued in billions. Railbird started in 2021 but only got the CFTC’s approval to be a designated contract market in June. Prediction markets are booming right now, with Polymarket and Kalshi together reaching more than $4.63 billion in trading volume just in the first 23 days of October, breaking last month’s record of $4.17 billion, according to DefiLlama data. Kalshi’s $2.87 billion in trading volume this month is already its highest turnover for a month.