EXCLUSIVE: Prediction Markets 'Not A Zero-Sum Game' – Market Expert Says Sportsbooks Can Still Win

The conflict betwixt prediction markets and sports betting companies could spot changing of marketplace stock positions and/or could bring caller users to the space.

A sports betting adept tells Benzinga determination are plentifulness of ways that sportsbooks tin inactive triumph successful the market.

Dave Mazza is the CEO of Roundhill Investments, the institution down the Roundhill Sports Betting & iGaming ETF (NYSE:BETZ).

As idiosyncratic who is pursuing sports betting companies daily, Mazza has a bully pulse connected the increasing contention of prediction markets and what it could mean for sportsbooks.

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Mazza told Benzinga that some DraftKings Inc (NASDAQ:DKNG) and Flutter Entertainment (NYSE:FLUT)-owned FanDuel are moving connected launching prediction-style products to pat the increasing market.

"That tells you the manufacture is evolving, not being displaced," Mazza told Benzinga. "Sportsbooks inactive triumph connected merchandise depth, idiosyncratic experience, media scope and regulatory positioning."

Regulation of prediction markets has been a cardinal battle, with immoderate states trying to support the likes of Kalshi and Polymarket from operating there, arsenic ineligible online sportsbooks are allowed to support operating.

Mazza said that prediction markets connection simplicity for users and tin supply antithetic pricing mechanics.

"Regulation volition find however accelerated this converges, but it's not a zero-sum game. Ultimately, we spot innovative disruption arsenic an denotation that the sports betting and gambling markets person longevity."

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Major sports betting stocks DraftKings and Flutter are down 26% and 34%, respectively, implicit the past 52 weeks. The 2 stocks are the 2nd and 4th largest holdings successful the BETZ ETF astatine 8.7% and 6.4% of assets, respectively.

"2026 looks similar a consolidation year," Mazza told Benzinga. "Operators are focused connected profitability, states are inactive funny successful taxation gross and we'll apt spot much concern reshuffling and selective M&A."

Mazza said legalization of caller states continues, but is astatine "a measured pace."

"How prediction markets are treated comparative to accepted sportsbooks volition beryllium an important plaything factor."