DraftKings Aims to Migrate Its Prediction Markets to an In-House Platform

Jason Robins, CEO of DraftKings, has confirmed that the operator plans to fully transition its prediction markets offering to an in-house platform. This strategy bears similarities to the approach adopted in the company's online sports betting. DraftKings Predictions, launched in late 2025, recorded an annualized volume of $11 billion in Q2 2026, with over 600,000 active users.

New In-House Exchange

In June, DraftKings launched DKeX, its in-house exchange developed from the acquired asset of Railbird. This move allows the brand to have greater control over content depth, operational economics, and customer experience. Although it currently uses platforms like Crypto.com and CME Group, the goal is to centralize all operations on DKeX. Additionally, DraftKings obtained approval as a futures trader from the National Futures Association.

Strategy Compared to Sports Betting

Robins emphasized in the Q2 earnings conference how the strategy is similar to DraftKings' evolution in sports betting. Initially, they adopted a customer lifetime value (LTV) model due to lacking data, but they now leverage the experience gained from sports betting. "Here we have comparable data that allows us to forecast customer acquisition well," Robins mentioned. The recent FCM license changes the unit economics, and DraftKings is setting timelines to migrate its volume to DKeX.

Economic Advantages

Jordan Bender, an analyst at Citizens, noted that this change will allow DraftKings to "capture attractive economics more quickly," expecting to surpass $600 million in event contract revenue for the next year. With an investment of $200 to $300 million in prediction markets, the path to 2027 looks positive. "The company is internalizing technology for prediction markets, which facilitates capturing volume economics," Bender said.

Full Control Over Technology

Robins compared the current plan to the change they made from Kambi in 2020 towards their own technology following the acquisition of SBTech. Previously, they used third-party technology for sports betting, but now, having their own platform allows them to capture more unit economics and improve customer acquisition. "Our development pace and ability to increase customer retention and monetization has been tremendous in recent years," concluded Robins.

The Future of the In-House Offering

This approach of having internal control translates to a greater capacity for investment in customer acquisition due to higher LTVs, in addition to improving retention and monetization by developing products at a more agile pace.