Incumbents Integrate Prediction Markets
Railbird
This shows prediction markets are becoming a feature inside bigger consumer finance and betting apps, not a standalone destination. DraftKings bought Railbird to get a regulated exchange and clearing stack quickly, FanDuel paired with CME to combine sportsbook distribution with derivatives infrastructure, Robinhood plugged into Kalshi inside its existing app, and Interactive Brokers expanded its own forecast contracts for active traders. That shifts the battle from product novelty to distribution, liquidity, and cost of acquiring order flow.
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DraftKings chose acquisition over internal build by buying Railbird in October 2025, which gave it a faster path into prediction markets than standing up a new federally regulated venue from scratch. That matters because exchange licenses, clearing, and market surveillance are the hard part, not the front end app.
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FanDuel and Robinhood both leaned on partners that already had market infrastructure. FanDuel used CME for contract design, clearing, and derivatives plumbing, while Robinhood launched its prediction markets hub through Kalshi inside the main Robinhood app. In both cases, the incumbent supplied the users and payments, and the partner supplied the market rails.
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The result is pressure on independents from both sides. Large apps can cross sell prediction markets to millions of existing funded accounts, while infrastructure venues like Kalshi and CME can win by becoming the back end liquidity layer for many branded consumer experiences at once. That leaves pure plays paying more for each new trader and earning less per trade.
The next phase is likely a split market. A few infrastructure venues will concentrate liquidity and compliance, while sportsbooks, brokerages, and crypto apps compete on audience, interface, and bundled distribution. For Railbird inside DraftKings, the upside is becoming one of the native rails rather than a niche destination that has to buy every customer one at a time.