DraftKings told investors on June 9 that its prediction markets business is rapidly expanding and the market likes its prospects. According to the company’s Form 8-K report, annualized consumer transaction volume on the Predictions service in May 2026 increased 24% month over month to $1.3 billion, and total annualized transaction volume increased 34% to $3.1 billion. DraftKings stock rose about 10% in early trading on the news.
DraftKings launched Predictions in December 2025, so these numbers are huge for a product line that’s only six months old. However, when compared to the broader category, companies that are late to market show that predictive-native platforms are already being incorporated into something much larger.
On an annualized basis, this $3.1 billion translates to approximately $258 million in actual trading volume in May. In comparison, Kalsi processed $17.9 billion in May alone.
The difference between DraftKings’ $258 million and the projected market’s $24 billion.
Prediction markets allow you to trade contracts tied to the outcome of future events, from elections and inflation data to sports results and cryptocurrency prices. Each contract pays $1 if the event occurs and $0 if the event does not occur, with prices in between acting like a live probability gauge. A contract trading at 65 cents means that traders collectively give the outcome a 65% probability.
As with stocks, you can hold onto them until the event is resolved or sell them early at the current price. Due to their structure, these platforms essentially operate like financial exchanges, with order books created and prices constantly fluctuating. This is a big part of why so many companies are rushing to get involved.
This will also help decipher some of the accounting included in the DraftKings announcement. “Annualized” means that a company’s monthly activity is multiplied by 12. This is a standard way to show momentum, but the headline number is 12 times larger than what actually happened.
Strip that out, and DraftKings processed about $258 million in transactions in May. Established platforms operate on a completely different scale. According to a Pew Research Center analysis, the combined monthly trading volume of the two largest companies, Calci and Polymarket, rose from less than $5 billion in September 2025 to about $24 billion in April 2026.
May data released after the Pew survey showed the two platforms moving in opposite directions. Kalshi recorded a record of 9 consecutive months at $17.91 billion, while Polymarket’s sales fell for 2 consecutive months to $7.08 billion.
For comparison, all legal sportsbooks in the U.S. combined generated approximately $14 billion in wagers per month throughout 2025. The prediction market category that DraftKings just entered is already moving more money than the industry in which DraftKings was born.
However, it’s important to note that each platform measures volume differently. Robinhood skips the dollar entirely and reports the number of contracts traded. This number sounds astronomical, since contracts most often cost less than $1 per contract.
The company’s CEO, Vlad Tenev, said more than 12 billion contracts were traded on the platform in 2025, predicting that the business could eventually grow its annual trading volume to “trillions”, while Deutsche Bank has counted more than 16 billion contracts so far by 2026. Although the scale is different, all versions of the calculation lead to the same result. DraftKings’ trading volume in May is about the same as Carsi’s weekly trading volume.
Sports is the driving force driving all of this forward, which explains why sportsbooks have no choice but to emerge. As reported by CryptoSlate, sports alone account for approximately 80% of Kalsi’s trading volume, and when combined with politics and cryptocurrencies, sports have driven approximately 91% of Kalsi’s activity and 90% of Polymarket’s activity since July 2024.
DraftKings has timed its disclosures in the days before the 2026 World Cup and immediately after the NBA Finals, with one estimate pegging potential World Cup prediction market activity at $2.5 billion.
What sportsbooks are really looking for
Each side in this battle has weapons that the other doesn’t. Sportsbooks bring millions of existing customers, well-known brands, payment infrastructure, huge marketing budgets, and years of experience in pricing live odds.
Prediction-native platforms bring a deep pool of traders ready to be on the other side of any contract, a much broader menu of events, and importantly, a legal structure that allows traders to operate where sportsbooks cannot.
DraftKings CEO Jason Robbins told investors the company intends to establish itself as a leader in sports forecasting by the end of the year, raising his estimate of the company’s total addressable market from $55 billion to $80 billion.
This legal structure is the entire reason this category exists. Sports betting in the United States is managed on a state-by-state basis, and each sportsbook requires a license in every state in which it operates. Event contracts follow a different legal route. Event contracts are classified as derivatives, which are financial instruments overseen only by the CFTC, the same regulator that oversees oil and corn futures. A federal license means that one approval covers the entire country. As such, DraftKings launched Predictions in 38 states, including states where online sports betting is still illegal.
Whether that route survives is now the central legal battle in the American gambling world. A federal appeals court ruled on April 6 that Carsi’s sports contracts likely fall under exclusive federal jurisdiction and are protected from New Jersey gambling enforcement.
Ten days later, another appellate court hearing the Nevada case appeared inclined to rule in the opposite direction. Diverging courts usually require the Supreme Court to settle the case, and prediction market traders themselves believe there is a 64% chance the high court will take up the case by the end of the year.
Meanwhile, enforcement continues to escalate in both directions. The CFTC sued Arizona, Connecticut, and Illinois in April to block its pursuit of Calci and Polimarket, courts in Maryland and Massachusetts sided with state regulators, Calci faces more than a dozen federal lawsuits, and a CryptoSlate report shows similar tensions are playing out overseas, from user surveys in South Korea to platform blocks in Brazil.
The next notable decision comes from the Sixth Circuit. There, Mr. Carsi is appealing a ruling that contradicts the Ohio ruling, and the number of coalitions against Mr. Carsi and the company continues to grow.
Former CFTC Chairman Gary Gensler, who led the CFTC Commission when Dodd-Frank was introduced in 2010, filed a court brief on June 11 arguing that Congress never intended for his agency to become a national sports betting regulator and that sports betting is not a swap under the law he helped write.
He filed along with the American Gaming Association, 30 Native American tribes, the Indian Gaming Association, and Better Market. A parallel case in Massachusetts has already had 38 state attorneys general lined up behind the state.
This division extends to the sportsbook industry itself. DraftKings and FanDuel left AGA in November 2025, days before DraftKings launched Predictions, after the industry group transitioned to members operating prediction markets. The association is now arguing in court that the product DraftKings has just built is illegal gambling.
Before you take these numbers at face value, there’s one more thing worth understanding. That is, trading volume is how much money is traded. revenue It’s a small slice that the platform holds. Because this slice comes from a fee of a few cents per contract, the actual revenue earned on a $1 billion deal may only be a few million dollars.
The industry as a whole incurred about $31 million in fees in April, of which Polymarket recovered $29 million as its traders placed larger bets, even though it lagged well behind Calci in trading volume. DraftKings hasn’t disclosed how much profit Predictions’ volume will generate, so the $3.1 billion run rate only measures traction and leaves the question of profit open.
DraftKings prediction market growth has been significant, with a 34% monthly increase being a price-moving number. But more importantly, traditional sportsbooks follow a category they didn’t invent. In that category, Calci, Polymarket and Robinhood have already shown that event contracts can generate billions of dollars a month, and have spent years building both the depth of their deals and the legal arguments to defend them.
Whether DraftKings can convert sports viewers into exchange-style traders before those platforms become too liquid to capture is an open question, and the answer will say a lot about whether the sportsbook model will absorb or be absorbed by the prediction market.
