Underdog has announced what its founder called “not fun news.” As it turns out, the company is shutting down its fantasy sports business in seven states in favor of prediction markets. This comes amid a continued conflict surrounding the legality of prediction markets in certain states.
Underdog Halts Drafts Offer in Seven States
The announcement was made by Underdog’s founder and chief executive officer, Jeremy Levine, who confirmed that the company will be shutting down Drafts at the start of the NFL season. According to him, seven states will be affected. These include the following:
- Massachusetts
- Maryland
- Michigan
- Mississippi
- New Jersey
- Pennsylvania
- Ohio
Levine clarified that submitted drafts will be settled, but players in those states will no longer be able to enter new ones. He apologized to all Drafts fans who have been affected.
Levine explained that the reason for the shutdown is that companies that offer CFTC-regulated products are not allowed to also offer fantasy sports in the aforementioned states. While Levine said that his team didn’t wish to choose, it had to do so regardless.
Levine Teases That Drafts Might Make a Return Someday
Levine’s statements revealed that prediction markets are an increasingly important product to Underdog’s business. He explained that his team could have kept its fantasy sports in the seven states if it had surrendered its prediction markets business. Ultimately, his team decided to prioritize prediction markets.
It sucks. I love Drafts. It was the first game we ever launched and a big part of what built Underdog. Even though they don’t get anywhere near the usage of our other offerings, we still care deeply about them. And it pains me that we can’t do right by the Drafts community and offer the best experience possible to the most customers.
Jeremy Levine, founder & CEO, Underdog
However, not all is grim since Levine teased that his team “has some ideas” about how to get Drafts back to more customers. However, he also said that it was “too early to commit to anything yet.”
I’m optimistic, and we’re definitely going to try. But until then, I don’t think there’s really anything I can say other than I’m sorry.
Jeremy Levine, founder & CEO, Underdog
Earlier this year, Underdog acquired the Aristotle Exchange DCM and Aristotle Exchange DCO, which enabled its foray into the prediction markets space. Since then, the company has been bullish on the sector, steadily expanding its presence.