Smarkets CEO Jason Trost has revealed the company is in the process of acquiring a licence from the Commodity Futures Trading Commission (CFTC), the US derivatives regulator.
Speaking on Eilers & Krejcik Gaming’s Zero Latency podcast, Trost revealed the operator was in the throes of applying for a Designated Contracts Markets licence from the CFTC.
Trost said Smarkets has engaged lawyers and consultants for the process. Smarkets is currently live with its sportsbook, SBK, in Indiana.
SBK had previously been available in Iowa and Colorado. In 2023, the operator announced it was pausing US investment to focus elsewhere.
The company operates its peer-to-peer Smarkets exchange in the UK, as well as the bookmaker-like SBK app, with its pricing generated by the exchange and its market maker, Hanson Applied Sciences.
Trost revealed that when Smarkets was looking to expand into the US in the late 2010s, applying for a CFTC licence to launch an exchange had been considered as an option.
He and the team ultimately decided against it, but the CEO has now said the steps taken by Kalshi in ensuring political event contracts can be legally traded had opened the door for others.
Trost remarked: “With what Kalshi has done in blowing the regulatory door open, it’s a no brainer for us as a business to get a CFTC licence.
“I want [it] to be Smarkets in the US as an exchange and people can trade futures exchange events. My long-term vision for Smarkets is to turn it into a general trading platform. If you want to trade stocks, bonds, options, prediction markets – you can do that with Smarkets.”
Kalshi, Robinhood and Crypto.com have all expanded into sports event contracts, moves that have been met with ire from state-level sports betting regulators.
Trost said that while there remains the possibility that sports event contracts are legally struck down, Smarkets will plow ahead with applying for a licence.
The CFTC dropped its challenge against Kalshi related to political event contracts earlier this year.
Trost continued: “There’s a 100% chance we will be able to offer politics. I believe that this is interesting, if you can do politics. It’s only interesting in the US once every two years.
“I still think it’s worth doing even if we don’t get sports. It’s one billion percent a no brainer with sports but I think it’s a 100% no brainer with politics. We are going [to apply for a licence] whether sports get struck down or not.”
On the future makeup of the prediction markets space in the US – where Kalshi has just secured $185m in a Series C funding round, valuing the New York-based startup at $2bn – Trost said a new leader could emerge.
He suggested sports betting operators such as DraftKings and FanDuel should explore the possibility of securing a licence, and that those firms would be in a good position to hijack Kalshi’s crown.
He added: “Eventually there will be a [number] one and two winner in prediction markets. The liquidity will start to pool. Kalshi obviously had a head start but I don’t think it’s a given they are going to be the dominant exchange in two years’ time.”
The post Smarkets in the process of applying for CFTC licence, says CEO first appeared on EGR Intel.
Jason Trost reveals it’s a “no brainer” for the business behind the SBK sportsbook app to become a platform to trade “stocks, options, and prediction markets”
The post Smarkets in the process of applying for CFTC licence, says CEO first appeared on EGR Intel.