Underdog Sports withdrew its approved application to offer mobile sports betting in Missouri earlier this month as the daily fantasy company continues to expand its prediction market business.
An Underdog spokesperson confirmed the decision to InGame. Underdog, in a technology partnership with Crypto.com, has expanded its prediction market footprint from 19 states to 24 since commencement in September. Missouri is one of the recent additions.
The news was first reported by Fox 2 Now on Tuesday as media attention began increasing for an expected 12:01 a.m., Dec. 1 launch of mobile sports betting in the state.
Mike Leara, executive director of the Missouri Gaming Commission, said that regulators had been told by Underdog that it would focus its future efforts on prediction markets, which are regulated at the federal level by the Commodity Futures Trading Commission.
“They have decided to go to that market,” Leara told the station. “It’s not regulated at any level compared to what traditional sports betting is regulated, and obviously, there’s no tax on it.”
Underdog had already chosen sides
Underdog currently offers state-licensed sports betting only in North Carolina. The company announced in October that it planned to use Kalshi, a well-capitalized and controversial powerhouse in the prediction market sector, to manage risk.
Sports events contracts remain a contentious and unresolved legal issue as state regulators continue to argue that they constitute unlicensed, untaxed sports betting with their expanding menus of sportsbook-like offerings.
Numerous state gambling boards have warned sportsbooks and technological vendors licensed to offer sports betting in their jurisictions that being even tangentially associated with prediction markets could emperil their standing. That has not not dissuaded the most powerful companies in the United States sports gambling industry.
Investments and partnerships continue to pour into the sector, with the nation’s most successful sportsbook companies — FanDuel and DraftKings — announcing plans to launch prediction markets imminently.
Underdog had gained “tethered” sports betting market access to Missouri through a partnership with the Kansas City Royals.
