Photo by Naser Tamimi on Unsplash

In an unprecedented move, sportsbook kingpins FanDuel (NYSE: FLUT) and DraftKings (Nasdaq: DKNG) have abruptly announced they are both exiting the industry’s primary trade body, the American Gaming Association (AGA).

Tuesday’s announcement marks the first time the country’s two dominant sportsbooks have broken ranks; however, the timing leaves no doubt as to why they did it. 

In a clear signal to investors and industry stakeholders, FanDuel and DraftKings didn’t just walk away from the AGA on a gamble. No, it’s evident that both companies are feeling the heat from fast-moving prediction markets like Kalshi and Polymarket. Walking away from the long-standing AGA gives FanDuel and DraftKings the chance to stem the bleeding.

In doing so, it supports the joint consensus that U.S. courts will ultimately side with federally regulated event-contract platforms soon, a catalyst that has already sent DraftKings and FanDuel’s shares nosediving. 

AGA Snapshot

The AGA was founded in 1994 with the goal of lobbying on behalf of the gambling industry. Here are some other notable facts about the association:

• Represents commercial casinos, tribal casinos, sportsbook operators, suppliers, and regulators.
• Acts as the primary lobbying voice for regulated U.S. gambling.
• Led major efforts to overturn PASPA in 2018, paving the way for legal online sports betting.
• Prioritizes state-level oversight, strict licensing, and consumer protection standards.
• Opposes any products that circumvent state taxes or regulatory structures.
• Now faces the first major membership fracture in its modern history.

Sportsbook split suggests prediction markets are here to stay

You could argue that the warning sirens have been blaring once Kalshi had revealed its sports contracts had garnered more than $2 billion in trades in the first half of 2025, with Polymarkets’ declaration that they were relaunching back in August only amplifying the alarm bells.

FanDuel was undoubtedly the quickest to react by forging a partnership with CME Group (Nasdaq: CME) in the summer, which will see them launch their own prediction market offerings, FanDuel Predicts, next month. 

DraftKings, on the other hand, we’re slower off the mark. Nevertheless, their acquisition of Railbird last month should see them launching a likely alternative in early 2026, although Polymarket has registered over $230k in trades in its playfully taunting, “Will DraftKings launch a prediction market in 2025?” market.

(Click on image to enlarge)

Source: Polymarket

FanDuel and DraftKings vs. AGA mindset and state regulators’ opposition 

Debatably, the reasoning behind both sportsbooks’ meteoric departure stems from the conflicting ideals of those at the AGA. 

None starker than AGA’s CEO Bill Miller, whose keynote speech in October stated prediction markets, “attempt to blur the lines, calling it investing or sweepstakes or skill games or sports event contracts—anything but what it really is, which is gambling.”

It has to be said, Nevada’s recent decision last week to declare planned sports event contracts as “unlawful activities” may have also cemented the decision to part ways with the AGA. Boldly, rather than backing down, both operators subsequently withdrew their Nevada applications.

Clearly, the writing appears to be on the wall as the U.S. betting landscape looks set to endure a rather seismic restructuring. However, for FanDuel and DraftKings, the time for preserving legacy trade body ties is over now as it’s become an all-out fight for survival instead.

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