Novig secures CFTC approval as sports prediction market competition intensifies

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Novig CFTC approval in sports

Highlights

Novig receives Commodity Futures Trading Commission approval to operate a federally regulated peer-to-peer sports prediction market, following ProphetX’s similar approval last week.
Novig raises $75 million in Series B led by Pantera Capital, valuing the startup at $500 million with over $105 million total capital raised and over $5 billion in cumulative platform volume.
Competitive pressure intensifies as Kalshi sets a daily record of $1.2 billion in volume and faces legal challenges alongside the CFTC's efforts to defend and refine federal oversight of prediction markets.

Federal approval and Novig's market model

As reported by CNBC, the Commodity Futures Trading Commission on Tuesday grants approval for Novig's designated contract market application, a step that allows the company to operate as a federally regulated prediction market focused on sports. The decision comes a week after ProphetX receives similar approval, expanding the field of licensed entrants competing in a fast-growing category.

Novig says its core pitch is a peer-to-peer sports trading platform where users trade against one another instead of betting against the house. Co-founder Jacob Fortinsky says the model removes the traditional sportsbook middleman, with the platform earning revenue from trading activity rather than customer losses.

Fortinsky argues that this structure is more aligned with users because Novig remains agnostic to game outcomes. The company is moving its entire business into the CFTC-regulated prediction market category after previously operating in Colorado under a state sports-betting license and later shifting to a sweepstakes-based product; it says it will keep a 21-and-over age limit.

Novig also enters the market with significant funding for a young startup. The company says it raises a $75 million Series B in February led by Pantera Capital, and Forbes reports the round values Novig at $500 million and lifts total capital raised to more than $105 million. Novig says it has recorded more than $5 billion in cumulative volume and more than $8 billion in annualized volume.

Liquidity race and regulatory stakes

Novig faces a crowded field that includes Kalshi, Polymarket, Robinhood, Crypto.com and major sportsbook groups such as FanDuel, DraftKings and Fanatics. Each company is pursuing a different strategy, from exchange-native trading and brokerage distribution to app-based bundling of sportsbook, casino and prediction products.

Kalshi remains the dominant player, helped by heavy activity during major sports events. CNBC reports Kalshi sets a daily record of $1.2 billion in trading volume on Saturday, while Piper Sandler analyst Patrick Moley says weekend prediction market volumes surge, with Kalshi posting $3.38 billion, Polymarket totaling $1.41 billion and Robinhood's Rothera reaching $131.4 million over the weekend and Friday.

That concentration matters because liquidity tends to attract more liquidity, making it harder for new entrants to build scale. For Novig, ProphetX, Betr and others, the challenge is to create enough differentiated pricing, product design and consumer trust before the biggest exchanges, brokers and sportsbooks define the market.

The legal backdrop is also becoming more contentious. Multiple states and tribes are suing Kalshi and others, arguing they facilitate unlicensed gambling, while Kalshi maintains that prediction markets fall under CFTC regulation. The CFTC is also defending its federal oversight in court and has proposed rules that would generally allow sports event contracts while restricting markets tied to injuries, officiating decisions, high school sports, fights, war, terrorism and other sensitive or easily manipulated events.

In our earlier article, we analyzed CME Group’s recent slide and the technical signals pointing to sustained selling pressure. We noted that CME was trading below key moving averages, with bearish momentum indicators and an important support zone around the mid-$240s that traders were watching for a potential break.

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