Nevada’s gaming regulator warned sports betting operators last month that it considers sports-prediction markets to be illegal gambling, and it threatened to take action if companies offer sports event contracts without approval.

On Wednesday, it made good on that promise. 

The Nevada Gaming Control Board issued a pointed statement in response to FanDuel and DraftKings each revealing plans to launch prediction-markets platforms—FanDuel Predicts will come online next month, while DraftKings Predictions is expected to be live “in the coming months” and potentially before the end of the year. 

“It has been made clear to the Board that Flutter Entertainment/FanDuel and DraftKings intend to engage in unlawful activities related to sports event contracts,” the regulator said. “This conduct is incompatible with their ability to participate in Nevada’s gaming industry.”

Both companies intend to focus their prediction-markets plans on U.S. states where online sports betting is not legal, such as Texas, California, and Georgia. FanDuel specifically said users will be able to use the new app only if they are not on tribal lands. Nevada’s rules for online betting are burdensome; operators must register with the state and partner with a licensed land-based casino, and customers are required to complete their initial account verification in person.

Curiously, the regulator’s statement wasn’t about levying fines or outright blocking operations. Instead, it was announcing it had accepted application withdrawals from both companies.

Unlike rivals such as Caesars and BetMGM, FanDuel and DraftKings are not currently licensed to offer retail or mobile sports betting in Nevada, with both companies having withdrawn or never pursued the necessary state approvals.

Neither has a significant presence in the state—FanDuel was licensed to operate a retail sportsbook at the Fremont Hotel & Casino under a partnership with Boyd Gaming, but Boyd took over management of that location through a deal announced in July. DraftKings, meanwhile, has a 90,000-square-foot office in Las Vegas but does not operate any retail or online sportsbooks.

In response to the regulator’s fiery statement, a FanDuel spokesperson said Wednesday that while the company is “enthusiastic about expanding [its] presence in Nevada, our views of the current opportunity for prediction markets outside of regulated states are unfortunately in direct opposition to Nevada’s priorities for its licensed operators.”

“We look forward to resuming our Nevada efforts in the future as circumstances allow,” the spokesperson said.

Jen Aguiar, chief compliance officer for DraftKings, said “prediction markets are federally regulated by the Commodity Futures Trading Commission,” and “we remain dedicated to working collaboratively with regulators to uphold the highest standards of integrity in our operations.”

Aguiar hit on a key point in the prediction-markets battle. Industry players claim the offerings are legal because they are federally regulated by the CFTC. But Nevada’s gaming regulator has been trying to keep prediction markets out of the state for the better part of the year. In March, it ordered Kalshi to cease operating in the state. In response, Kalshi sued the regulator, and in April notched a preliminary victory when a judge ruled Kalshi could continue offering sports event contracts while the case remains ongoing. 

The Nevada Gaming Control Board has also issued cease-and-desists to companies including Crypto.com and Robinhood, both of which offer prediction-markets products. Each of those companies also sued the regulator; last month, in the Crypto.com case, the same judge who ruled in favor of Kalshi issued a ruling in the opposite direction, saying he would not prohibit the regulator from taking action, for now. No major rulings have been made yet in the Robinhood case, which was filed in August.

Nevada—once the undisputed sports betting capital of the U.S.—is working to maintain its prominence amid growing competition. Since the 2018 U.S. Supreme Court ruling that opened the door to sports betting nationwide, 38 states and Washington, D.C., now permit some form of sports wagering, and 30 states offer online betting. The rise of prediction markets represents another challenge to Nevada’s regulatory dominance.

Sports betting volume in the state has fluctuated in recent years. After dipping to $4.3 billion in 2020 during the COVID-19 pandemic, wagers rebounded to $8.2 billion in 2021 and $8.7 billion in 2022, before falling slightly to $8.3 billion in 2023 and $7.9 billion last year, according to the UNLV Center for Gaming Research.

When FanDuel revealed a planned prediction-markets push in August, sports were conspicuously absent. That has changed.

Next month, the sports betting giant is launching a stand-alone mobile app, FanDuel Predicts, that will feature an array of event contracts, including on the prices of oil and gas, gold, and cryptocurrencies, but also sports offerings across baseball, basketball, football, and hockey—although there’s a catch. 

Sports event contracts will be available only to users in states where online sports betting is not yet legal, such as California, Texas, and Georgia, and users will only be able to trade on the outcome of sporting events if they are not on tribal lands. When a new state legalizes online sports betting, sports event contracts will no longer be available there.

The idea is that FanDuel’s core offering—traditional sports betting—remains its primary business. But it knows it cannot ignore the rise of prediction markets, something it made clear when it announced a “groundbreaking alliance” with derivatives exchange CME Group.

Currently, 38 states and Washington, D.C., offer some kind of legal sports betting, but only 30 states allow online sports betting via mobile apps or websites. In addition to California, Texas, and Georgia, states that don’t currently offer any sports betting are Alabama, Alaska, Hawai‘i, Idaho, Minnesota, Oklahoma, South Carolina, and Utah. States that allow sports betting but haven’t legalized online sports betting include Mississippi, New Mexico, and North Dakota.

FanDuel says the new app will feature safety tools meant to help users “manage exposure, track spending and make informed trading decisions.” To sign up, users will need to provide their date of birth, social security number, home address, banking information, and a valid ID. 

“We can’t wait to bring FanDuel’s proven approach to product innovation into this dynamic sector,” FanDuel CEO Amy Howe said in a press release. “Our partnership with CME Group allows us to leverage their deep market expertise built over decades while delivering the seamless, accessible and trusted experience our customers expect.”

FanDuel, which is owned by Flutter Entertainment, said in August its new prediction-markets product will be regulated by the Commodity Futures Trading Commission (CFTC), a federal agency, while its traditional sports betting products are regulated on a state-by-state basis.

The company’s approach is similar to its main sports betting rival, DraftKings, which this month outlined plans to launch its own prediction-markets platform in the “coming months,” and said it will “enter many states with sport event contracts,” with a focus on those where sports betting is not yet legal.

FanDuel and DraftKings—which together hold a sports betting industry market share of more than 65%—are joining an increasingly crowded prediction-markets field. Players include Polymarket, Kalshi, President Donald Trump’s social media platform Truth Social, Crypto.com, Robinhood, PrizePicks, Underdog, and Novig. 

Sports event contracts have garnered controversy because they appear so similar to sports betting. Traditional sportsbooks are regulated state by state. Kalshi, Robinhood, and others have been fighting various lawsuits over whether their sports offerings are legal.

Joe Lewis, the 88-year-old billionaire whose family owns Premier League soccer club Tottenham Hotspur, has been pardoned by U.S. President Donald Trump, giving Lewis a clean slate after his 2024 insider trading conviction.

Lewis, a British national who was born in London, has been on probation since his 2024 conviction after pleading guilty to one count of conspiracy to commit securities fraud and two counts of securities fraud. One of his businesses, hedge fund Broad Bay, pleaded guilty to one count of securities fraud. In total, he and Broad Bay were ordered to pay a $50 million penalty.

Lewis was accused of providing his girlfriend and private-jet pilot with nonpublic stock tips about his portfolio companies for Tavistock Group, his private-equity firm.

“I am pleased all of this is now behind me, and I can enjoy retirement and watch as my family and extended family continue to build our businesses based on the quality and pursuit of excellence that has become our trademark,” Lewis said in a statement Thursday.

In a separate statement, a source close to the Lewis family thanked President Trump “for taking this action.”

“Over his long business career, Joe has been a visionary, creating businesses across the world which multiple generations of his family are now taking forward,” the source added. “This is why there is so much more to the Joe Lewis story than this one event.”

Under his conviction, Lewis was not allowed to travel to the U.S. Since his probation began, Lewis has been spending time in the Bahamas on his yacht, a 322-foot vessel named Aviva, as well as at a property in Argentina, a source familiar with the matter tells Front Office Sports.

An email to the Office of the Pardon Attorney for the federal government elicited an auto-response due to the federal government shutdown, which technically ended Wednesday night: “The appropriation that funds the Office of the Pardon Attorney has lapsed, and as a result, much of our staff has been furloughed and is currently out of the office. We will respond after funding has been restored.”

The pardon comes as Spurs—who are now controlled by a family trust after Lewis relinquished “significant control” in 2022—repeatedly beat back rumors that they are for sale. Four sources who work in European soccer recently told FOS it’s only a matter of time before the team is sold.

An attorney who represented Lewis in his insider trading case did not immediately respond to a request for comment. The U.S. Department of Justice declined to comment.

Lewis represents the third sports-related figure to receive a presidential pardon this month. Former Yankees and Mets star Darryl Strawberry was pardoned for tax evasion charges that date back to 1995, and trail runner Michelino Sunseri was pardoned of charges that he used a prohibited trail.