00:00This is actually a learning tool for me because I didn't know that DraftKings didn't have their own proprietary, I
00:08guess, operation as far as their prediction market business is concerned.
00:12I simply thought when they launched their app and they launched their prediction markets as they were doing their own
00:16thing.
00:17So my understanding learning from you here is that they've been using markets offered by other, I guess, other exchanges.
00:25So tell me why that happened and why they've decided to use their own exchange, because simply put, wouldn't it
00:31cost them more money to use this information?
00:35There's a lot behind this. Yeah, we just had DraftKings and also talk about FanDuel, I think, do their Q1
00:40earnings call.
00:41We learned a lot about their prediction markets business.
00:43Of course, they both in the last couple of months have launched prediction markets themselves that are separate from their
00:49sports books.
00:49But yeah, DraftKings has been using a combination of CME Group, which is a traditional commodities exchange that also has
00:57a prediction market operation.
01:00It also has worked with Crypto.com to surface markets.
01:03So when you look at DraftKings and the prediction markets product, you're actually looking at those markets.
01:07It's being presented through DraftKings, but it's not.
01:09So now, last year, they have bought something called Railbird, which allows them to offer their own exchange, kind of
01:17like, not kind of like, exactly like Calci does or Polymarket does, where they own the exchange and they can
01:22offer their own markets and control the whole thing themselves.
01:26Yes, that costs them money to do that, but it gives them way more control of the plumbing and how
01:32all of this works.
01:33It also, it actually increases the amount of revenue they should be able to generate from all this right now.
01:38They are a pass-through for other markets, and they are just making a little bit of money.
01:43Now, they're going to be able to generate more money in terms of fees and trading.
01:47So this should be a net positive for DraftKings when they get all of this, and I think the goal
01:50for them will to be, they're going to be live here, they said, before the end of the quarter, I
01:54believe, and certainly before football season.
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