Fanatics acquires BGC exchange and clearinghouse, will partner on prediction markets
Fanatics will acquire Water Street Labs and CX Clearinghouse from brokerage BGC Group to launch a CFTC-regulated prediction market exchange. The deal gives Fanatics a designated contract market and derivatives clearing organization, letting it list and settle its own event contracts without building regulatory infrastructure from scratch. Fanatics announced the partnership on Monday. Sports-focused operators including DraftKings and FanDuel have made similar moves into regulated event contracts.
Fanatics now owns the full regulatory stack instead of renting it, following the same vertical-integration path DraftKings proved with DKeX and Underdog just executed with UDX. The deal shrinks the white-label market for standalone exchanges like Crypto.com that still sell regulatory rails to partners. Fanatics can control its own spreads, liquidity terms, and product timeline without negotiating revenue share.
That captive infrastructure becomes more valuable as Congress weighs a bipartisan ban on sports event contracts and the CFTC tightens its public-interest gate for new listings. Sports platforms with owned exchanges can adapt faster than those tethered to partner schedules. Fanatics' merchandise and betting empire gives it a ready user base that rivals must acquire at marketing cost. The next NFL season will test whether its in-house liquidity matches established venues, but the regulatory ownership alone puts it ahead of any late entrant still shopping for a clearing partner.