Fanatics will soon have greater control of its trading infrastructure, with plans to expand financial market offerings.
Key Takeaways
- Fanatics is acquiring regulated exchange and clearinghouse infrastructure to bring prediction market operations in-house.
- The BGC partnership allows Fanatics to tap more into financial prediction markets.
- Fanatics Markets is available in 23 U.S. states.
The merchandise and gaming company announced Monday it is acquiring Water Street Labs and CX Clearinghouse from BGC Group Inc, giving the operator a federally regulated designated contract market (DCM) and derivatives clearing organization (DCO). Fanatics Markets, the company’s prediction brand, has been offering trading through a Crypto.com partnership since December 2025.
Now, Fanatics, which offers sports event contracts, has an in-house full technology stack for trading. The deal includes a partnership that will combine BGC’s market and data analysis to “build a prediction market ecosystem that serves both retail and institutional participants,” a Fanatics spokesperson told Covers.
Enjoying Covers content? Add us as a preferred source on your Google account“BGC are experts in the financial services industry and, like Fanatics, have built their business on a foundation of cutting-edge technology, innovation, and exceptional talent,” said Matt King, CEO of Fanatics Betting and Gaming. “Their expertise in building and operating regulated exchanges, clearinghouses, trading technology, and institutional market infrastructure makes them an ideal partner.”
New focus
With no longer any need for a DCM partner, Fanatics can focus on creating and listing its own prediction markets, with a new focus on financial markets that could help set the operator apart from competitors and build its customer base.
Fanatics says this BGC partnership will be the first to “connect retail-focused prediction markets with the institutional marketplace.”
“By combining that institutional foundation with Fanatics’ unmatched understanding of fans and consumer engagement, we have a unique opportunity to accelerate the growth of prediction markets and deliver a best-in-class experience for both retail and institutional participants,” King said.
Expansion into prediction space
Fanatics entered the sports betting industry in January 2023 and launched its first online sportsbook eight months later. The operator acquired a federally regulated introducing broker in July 2025, with sights set on getting into prediction markets.
Through its Crypto.com partnership, Fanatics Markets launched weeks ahead of sports betting competitors FanDuel and DraftKings. The company’s prediction market is currently available in 23 U.S. states and four territories, including states without legal sports betting like California and Texas.
Fanatics Markets has enhanced its product since last year, adding “Combos” that act as parlays, as well as integrating its sportsbook and iGaming rewards program FanCash into its trading platform.
Big-time partner
BGC Group offers a wide range of financial technology products, and its client list includes major global banks, broker-dealers, trading firms, hedge funds, and governments.
The company’s FMX collaboration with investment banks and market-making firms features a U.S. interest rate futures exchange and other cash-treasury products.
“No one knows the sports fan better than Fanatics, and we believe the acquisition of BGC’s DCM and DCO will supercharge Fanatics Markets,” BGC co-CEO John Abularrage said. “Together, we intend to broaden institutional adoption of prediction markets and create innovative data products that unlock new insights for market participants.”
