Smarkets’ path to prominence in the United States of America could be paved with sports event contracts like the kind that are (somewhat controversially) offered by prediction market Kalshi.
Jason Trost suggested as much during this week’s episode of Eilers & Krejcik Gaming’s Zero Latency podcast.
The chief executive of the London-based sports betting company, which operates the Smarkets exchange and SBK sportsbook in the U.K., said it's trying to become a designated contract market regulated by the U.S. Commodity Futures Trading Commission (CFTC).
“The water's warm,” Trost said. “And, I mean, if that sports thing holds, like, why not? You have to.”
Key takeaways
- The CEO of U.K.-based sports betting company Smarkets says they're working to become a regulated prediction market in the U.S.
- Smarkets has dabbled in state-regulated sports betting in the U.S. but never achieved much market share.
- Now, though, the path Kalshi and other prediction markets laid out could offer Smarkets a way to offer sports event contract betting, or at least wagering on U.S. elections.
The “sports thing” Trost mentioned is the ongoing offering of sports event contracts by Kalshi and Crypto.com, CFTC-regulated exchanges that are shaking up online sports betting in the U.S.
Those sports event contracts are the subject of cease-and-desist letters from several state-level regulators arguing they are, in fact, sports betting, not some sort of financial hedging instrument.
Kalshi and Crypto.com, meanwhile, claim they're under the CFTC's exclusive oversight and that what they’re doing falls perfectly well within federal law. Legal battles are currently being fought in several states over the legality of the sports-related event contracts.
At any rate, the contracts are still trading widely on those CFTC-regulated prediction markets. And what that means is there's now a way to wager on sports in all 50 U.S. states, not just the 39 (plus the District of Columbia) that actually legalized sports wagering.
Room for one more?
Smarkets jumping into the mix would inject more competition into the still-young business of federally-regulated prediction markets in the U.S. It would also give Smarkets an opportunity to acquire more American customers than it managed with its initial foray stateside.
The company stopped taking bets in Colorado earlier this year and has minimal market share in Indiana, with its SBK sportsbook reporting $322,009 in May handle in the state. That was out of more than $433 million bet with Indiana sportsbooks for the month.
A whale just placed a $6.74K bet backing Ilia Topuria to win the upcoming MMA fight against Oliveira on June 28, 2025! 🥊🔥
— Whale Watch Kalshi (@kalshiwhales) June 27, 2025
If they’re right, they’ll win $8.65K.
Given sports event contracts are still being fought over in the courts, there’s a chance Smarkets may never get to offer them in the U.S.
Even so, Trost said it's committed to launching without sports, which would still mean it could offer users the option to bet “yes” or “no” on events tied to economics, pop culture, and, especially, politics. He also estimated the effort to become a registered DCM in the U.S. will cost Smarkets around $2 million over two years.
Kalshi already won a legal fight over election-related contracts, lighting the way for others to follow. Wagering on last year’s U.S. presidential election was a popular offering by the prediction market, with more than $500 million in trading volume reported.
“Politics are only interesting in the United States once every two years, four years, a little bit like the Olympics,” Trost said. “But I still think it's worth doing, even if we don't get sports. It's a 1,000,000,000% no-brainer with sports, but I think it's a 100% no-brainer with politics. So we're going to do it, regardless of whether … sports gets struck down.”
Trost also noted that what’s regarded as relatively new in the U.S., the betting exchange model, has been around for a long time elsewhere, namely, in the U.K. What’s really different is Kalshi went federal with the model, enabling it to get into all 50 states at once.
“The innovation that Kalshi has done is the regulatory innovation, but the model is exactly the same as a betting exchange,” Trost said.
Everybody's doing it
Smarkets is not the only sports betting company that’s taken note of what Kalshi is doing. DraftKings and FanDuel, the undisputed leaders in U.S. sports betting, are watching the situation intently.
FanDuel is owned by Flutter Entertainment, which already runs a betting exchange in the U.K., Betfair. It was also recently reported that FanDuel was interested in some sort of partnership with Kalshi.
Trost said his long-term vision for Smarkets is to make it a “general trading platform,” where users can buy and sell stocks, bonds, options, and, yes, predictions. Eventually, he added, sports betting will look more like those financial markets.
“The way I see this shaking out in 20 years is all these big brands are going to be brokers that sit on top of an exchange,” he said. “I don't think any sportsbook will be making any of their own markets in 20 years.”
