Fanatics has agreed to buy Water Street Labs and CX Clearinghouse from BGC Group, giving the sports platform its own federally regulated exchange and clearinghouse for prediction markets.
Crypto Business News
Fanatics has agreed to acquire two regulated financial market entities from BGC Group (Nasdaq: BGC).
The deal, announced July 27, covers Water Street Labs and CX Clearinghouse. Water Street Labs is registered with the Commodity Futures Trading Commission (CFTC) as a designated contract market (DCM). CX Clearinghouse is a CFTC-registered derivatives clearing organization (DCO). Financial terms were not disclosed.
Prediction markets allow participants to trade on the outcomes of real-world events. Those events range from sports results to election outcomes and economic data releases. The category has expanded sharply over the past year.
Full Control Over Listing and Settlement
Before this acquisition, Fanatics depended on outside infrastructure to list and clear its prediction market contracts. Owning Water Street Labs and CX Clearinghouse removes that dependency entirely. Fanatics can now decide which products to offer and how quickly to bring them to users. The two companies also agreed to develop new data products together. BGC will contribute its financial market analytics capabilities to that effort. The goal is to build tools that combine prediction market data with traditional financial market information.
Fanatics Markets launched in December 2024. It is currently available in 23 states and four US territories on iOS, Android, and the web. The platform offers features including FanCash loyalty rewards, a tool called Combos, and risk management features under the FanViz name. Matt King, CEO of Fanatics Betting and Gaming, said BGC's experience building regulated exchanges makes it a practical partner. BGC co-CEO John Abularrage said the deal lets BGC grow its data business while connecting its institutional expertise to Fanatics' consumer audience.
Related Article: Prediction Markets Are Clearing a Path Through Crypto’s Price Downturn
A Crowded Space Draws More Entrants
CFTC-regulated exchange Kalshi and blockchain-based platform Polymarket have driven much of the growth in prediction markets over the past year. Coinbase (COIN) partnered with Kalshi to bring prediction market contracts to users across all 50 US states. Robinhood (HOOD) has also begun offering event contracts through Kalshi. Sports betting companies are entering the same space. DraftKings announced late in 2025 that it would build its own prediction markets platform. Fanatics is positioning its sports-focused audience as a way to reach consumers who have not yet come to prediction markets through financial platforms.
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