Allwyn’s move to acquire a controlling stake in US daily fantasy sports operator PrizePicks highlights how the lottery group is extending its reach into new areas of regulated gaming.
The $1.6bn deal, which gives Allwyn a 62.3% share and values PrizePicks at $2.5bn, also carries performance-linked terms that could take the final valuation to $4.5bn if certain targets are achieved within three years.
The acquisition was followed almost immediately by a regulatory development. PrizePicks announced that its affiliate, Performance Predictions II LLC, had become registered as a Futures Commission Merchant (FCM).
The company, owned by SidePrize LLC, is now the first business linked to a fantasy sports platform to secure this status. The registration enables it to buy and sell Commodity Futures Trading Commission (CFTC)-regulated futures contracts, though only through approved Designated Contract Markets.
Mike Ybarra, CEO of PrizePicks, said: “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.
“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.”
Predictions under scrutiny
PrizePicks’ registration signals an entry into the prediction markets space, but this area remains under close watch from regulators.
The CFTC previously blocked Kalshi’s attempts to expand event contracts during Joe Biden’s presidency, while also requiring companies such as Crypto.com and Robinhood to withdraw products.
Under Donald Trump, federal policy has become more relaxed – but the same cannot be said of state regulators. State regulators in New Jersey, Maryland and Nevada have been involved in litigation with Kalshi, the US’ biggest predictions market provider, for example, while another legal battle has just opened up in Massachusetts.
A lottery-led expansion
For Allwyn, the move fits into a broader strategy of building a lottery-led entertainment business, with its reach having already been extended into sports betting via stakes in Greek firms OPAP and Kaizen, and a forthcoming shareholding in Novibet.
Allwyn took over as operator of the UK National Lottery last year. The move added to its existing lottery portfolio across Europe and has provided a stronger base for its expansion into other areas of gaming and entertainment.
Having established itself as a tier one lottery operator and expanded into sports betting and casino gaming, the company is now adding fantasy sports and predictions to its portfolio.
The deal structure, with its performance-related valuation, reflects how much emphasis Allwyn is placing on growth in this emerging sector.
Jason Barclay, Chief Legal Officer and Head of Public Policy for PrizePicks, concluded: “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.”
By backing PrizePicks at a high valuation and supporting its entry into regulated predictions, Allwyn is betting that its lottery experience in compliance and consumer protection will provide an edge in a market still shaping its boundaries.