By PredictQ Team // Updated: July 2026
FanDuel Predicts is legal in all 50 states plus Washington, D.C. for non-sports event contracts (commodities, financials, economics, crypto). Sports event contracts are legal and live in 18 specific states, the ones where FanDuel doesn’t run a state-licensed sportsbook. The whole product operates under federal CFTC regulation: FanDuel Prediction Markets LLC is a registered Futures Commission Merchant, and contracts execute on CME Group’s CFTC-regulated exchange.
That’s the short answer. The longer answer is more interesting, because 2026 has been the most consequential year in the legal fight over prediction markets, and FanDuel has structured itself to sit out most of that fight. Here’s the federal framework, the state map, and every major legal development through July 2026.
The Federal Framework
FanDuel Predicts stacks several regulated entities. FanDuel Prediction Markets LLC holds the FCM registration and NFA membership that let it serve retail customers. CME Group provides the CFTC-regulated Designated Contract Market and clearinghouse where contracts execute and settle. Plus500 was named at launch as the brokerage and clearing services provider. FanDuel Group and Flutter Entertainment sit on top as the brand and parent.
The legal theory underneath all of it: event contracts on a CFTC-registered exchange are financial derivatives under the Commodity Exchange Act, not gambling products under state law. Federal law preempts state gambling statutes for these contracts. That theory got its first real appellate test this year, and it won.
The State Map
Non-sports contracts: everywhere. All 50 states plus DC.
Sports contracts: 18 states. Alabama, Alaska, California, Delaware, Florida, Georgia, Hawaii, Idaho, Minnesota, Nebraska, New Mexico, North Dakota, Oklahoma, Rhode Island, South Carolina, South Dakota, Texas, and Utah.
Look at that list and the logic jumps out. These are overwhelmingly states without legal online sports betting. FanDuel Sportsbook operates in roughly two dozen states plus DC and Puerto Rico, and in every one of them, sports markets on Predicts are switched off.
Why FanDuel Restricts Its Own Product
Nothing in federal law forces this. The 18-state sports footprint is a business decision with three drivers. State regulator relationships come first: offering sports contracts in a licensed sportsbook state could put the sportsbook license itself at risk. Revenue math comes second: a licensed sportsbook customer is worth more than a 2%-fee prediction market customer. Enforcement risk comes third: Kalshi is fighting state regulators in courtrooms for offering sports contracts everywhere, and FanDuel chose a footprint that picks no fights. DraftKings made the identical call.
The Third Circuit Ruling
On April 6, 2026, the Third Circuit ruled 2-1 in Kalshi's case against New Jersey (Kalshiex LLC v. Flaherty), affirming a preliminary injunction and holding that sports event contracts on a CFTC-registered exchange are swaps under the Commodity Exchange Act, with federal law preempting state gambling law. First federal appellate ruling on the question, and the industry won it. It strengthens the legal ground the entire category stands on.
The CFTC Goes on Offense
The CFTC has now sued nine states over their attempts to restrict federally regulated prediction markets: Arizona, Connecticut, Illinois, New York, New Mexico, Minnesota, Rhode Island, Wisconsin, and Kentucky. It also opened a formal rulemaking published June 12, 2026, with comments closing July 27, 2026.
The States Push Back
A bipartisan coalition of 41 state attorneys general, co-led by Ohio AG Dave Yost, filed a formal comment arguing states retain authority over sports-related event contracts. Meanwhile North Carolina Governor Josh Stein signed SB 257 on July 7, 2026, formally recognizing the CFTC's federal authority, the first state to break ranks.
What This Means for FanDuel Users: Almost Nothing
Nearly every lawsuit in this space targets platforms offering sports contracts in states that object. FanDuel doesn't do that. Its sports footprint is 18 states that mostly have no sports betting law to enforce. If you use FanDuel Predicts, you're trading on the most conservative legal footprint in the industry, backed by CME Group.
Age, Taxes, and Margin
You must be 18+ (21+ in Virginia). Event contract profits are treated as capital gains, not gambling income, and FanDuel issues 1099s at reporting thresholds. There's no margin trading; your maximum loss on any contract is what you paid for it.
Bottom Line
FanDuel Predicts is legal everywhere for non-sports markets and in 18 states for sports contracts, operating under a federal framework that just won its first appellate test. The legal risk in this industry is concentrated on platforms offering sports contracts in hostile states. FanDuel deliberately isn't one of them.
Disclosures: PredictQ may receive compensation when readers sign up for platforms through links on this page. Information accurate as of July 2026. State availability varies and the regulatory environment is changing quickly. FanDuel Predicts is operated by FanDuel Prediction Markets LLC, a registered futures commission merchant. Trading event contracts involves significant risk and is not appropriate for all participants. This content is for informational purposes only and does not constitute legal advice. Must be 18 or older (21+ in VA). If you or someone you know has a gambling problem, call 1-800-GAMBLER.