The worlds of digital finance and sports are seemingly converging again for enthusiasts in some states. Underdog, a fast-growing fantasy and sports gaming company, has struck a deal with Crypto.com to bring sports prediction markets to 16 U.S. states. For regions still resisting traditional sports betting, this collaboration may provide a fresh entry point for fans who want to engage with the action in new ways.

Good Old Trading, But for Sports Fans

At the core of the partnership is Crypto.com Derivatives North America (CDNA), a federally registered exchange that specializes in sports event contracts. These contracts will sit directly on Underdog’s platform, effectively transforming sports speculation into a regulated trading environment. As Crypto.com’s Travis McGhee noted, this approach broadens access while positioning sports prediction as more than just betting. It is now much closer to financial trading with a sports twist.

The design mimics a marketplace more than a sportsbook. Instead of placing a fixed wager, users can buy or sell outcomes based on supply, demand, and sentiment. These are the same forces that drive financial markets. It’s an approach tailored for younger, tech-savvy audiences already comfortable with crypto exchanges and retail investing apps.

Eyes on States Like California and Texas

The significance of this move is amplified by geography. California, Texas, and Florida, the three most populous U.S. states, remain closed to commercial sportsbooks. Florida, in particular, is tightly controlled by the Seminole Tribe, which has a near-monopoly on gambling.

Prediction markets sidestep some of these hurdles because they fall under federal oversight rather than state-by-state gaming rules. For operators, this could reduce friction and open doors that have so far been locked by politics, tribal compacts, or lengthy regulatory battles.

Market analysts are already projecting serious potential. A recent estimate suggested that prediction markets could generate $555 million in 2025. That number pales in comparison to the $16 billion U.S. online betting market in 2024. However, the growth curve forecasts a sector quickly moving from experimental to mainstream.

Big Bets on the Future for Underdog

With this deal, Underdog becomes the first major sports-first operator to lean fully into prediction markets. Its CEO, Jeremy Levine, has argued that sports are the natural frontier for this format, and the company wants to be at the heart of that transition. By blending the adrenaline of betting with the strategy of trading, Underdog is positioning itself to capture a new demographic of players.

Competition is inevitable. Robinhood, Kalshi, Polymarket, and FanDuel are already testing similar waters, and DraftKings has hinted at its own ambitions. Still, Underdog’s early alignment with Crypto.com, which is one of the best-known crypto brands worldwide, gives it both credibility and reach.

If the bet pays off, prediction markets could emerge as a hybrid space where Wall Street meets Las Vegas. For sports fans, that means more than a new way to gamble but also a new way to play the markets.