PrizePicks has been granted a futures commission merchant (FCM) license by the National Futures Association, opening the door for the operator to offer prediction markets in the near future.
The licence was granted to Performance Predictions II, a subsidiary of PrizePicks’ parent company SidePrize, and allows PrizePicks to accept orders from its customers to buy and sell futures contracts offered by Designated Contract Markets (DCMs) that are regulated by the Commodity Futures Trading Commission (CFTC).
“The honor of being the first sports entertainment platform to receive a FCM registration from the NFA is a testament to our industry-leading compliance and consumer protection programs that both the NFA and CFTC demand,” said PrizePicks CEO Mike Ybarra. “Acting chairman Caroline Pham’s vision for the CFTC promotes innovation while reinforcing the importance of strong regulatory standards. Her leadership has set a thoughtful tone for the agency and our industry.”
Jason Barclay, chief legal officer and head of public Policy for PrizePicks, added: “As the nation’s leader in predictions, this is a defining moment for us. We are grateful to the NFA for its thoughtful process and diligent work on our application.”
The award of the FCM licence comes as Allwyn International acquires a majority stake in the operator.
Allwyn will acquire a 62.3 per cent stake in PrizePicks for an initial cash consideration of $1.6 billion, which could increase by an additional $1 billion if certain performance incentives are met over the next three years.