California still prohibits sports betting, but residents now have a new option to place bets on Dodgers and 49ers games.
This week, DraftKings introduced DraftKings Predictions in California, the state with the largest economy in the US and nearly 40 million residents. Despite a previous ballot referendum in 2022 rejecting Proposition 27 to legalize sports betting, DraftKings now allows traders to participate in financial trades related to sports.
Joining Kalshi and Polymarket, DraftKings Predictions joins the prediction market scene in California.
California is a highly sought-after market in the sports betting industry due to its large population and strong economy. This presents a lucrative opportunity for sportsbooks like DraftKings.
There are ongoing tensions among California’s tribal casinos, commercial cardrooms, and out-of-state gambling companies regarding sports betting. This disagreement has led to a standstill on how the market should be regulated. Consequently, voters rejected the 2022 sports betting ballot measure.
Prediction Markets vs. Sports Betting
Unlike traditional sports betting, prediction markets involve traders speculating on event outcomes rather than betting against the house.
In prediction markets, traders interact with one another, with share prices reflecting crowd-sourced probabilities. Some trades involve financial institutions like Susquehanna International Group, providing liquidity to prediction markets.
Advocates of prediction markets believe that trading shares in sports outcomes is a financial activity. However, critics argue that such trading resembles illegal sports gambling.
DraftKings Campaigns
In conjunction with the launch of DraftKings Predictions in California, DraftKings launched an advertising campaign in key sports betting states.
According to Aldrin, DraftKings Predictions is aggressively marketing in California, Texas, and Georgia, as well as in Florida where the Seminole Tribe’s Hard Rock Bet holds a monopoly on legal sports betting.
New accounts on DraftKings Predictions can receive $200 in bonus trades after depositing $5.
DraftKings refers to DraftKings Predictions as its “financial market,” offering trading options on sports, stocks, cryptocurrency, weather, politics, and culture.
For instance, DraftKings Predictions has Zohran Mamdani as the front-runner to be TIME’s Person of the Year, with odds at +156 (39% probability). Pope Leo XIV follows at +426.