Sportsbooks Drop More Than $40 Million in State Politics While Chasing Prediction Markets

DraftKings and FanDuel are signaling that prediction markets represent a strategic priority for growth. At the same time the operators are spending tens of millions through super PACs to shield their core sports betting revenue from tax hikes, advertising curbs and prop bet restrictions.

The numbers are concrete. DraftKings, FanDuel and Fanatics have contributed approximately $42 million to the Win for America super PAC network created in late 2025. That money has funded activity in more than a dozen states in the first quarter alone with over $33 million spent on state level political efforts.

From the supplier side this looks like classic risk management. Operators are testing new product lines while locking down the business that still pays the bills.

Prediction Markets as Strategic Priority

DraftKings executives described prediction markets as a strategic priority and an acquisition tool for users in non sports betting states during the company’s first quarter earnings call. The company has continued investing in exchange infrastructure including its recently introduced in house DKeX platform.

Flutter executives have described prediction markets as an attractive incremental customer acquisition opportunity. The company will remain very disciplined in terms of investment around prediction markets and invest more if opportunities arise.

These statements come from recent earnings calls where both DraftKings and Flutter discussed prediction markets as a potential opportunity. Yet traditional sports betting remains the industry’s primary revenue driver.

That split explains the heavy political investment. Operators are not walking away from sports betting. They are protecting the foundation while they experiment with what comes next.

The Scale of Political Spending

According to Federal Election Commission filings DraftKings contributed $17.5 million to Win for America. FanDuel contributed approximately $19.5 million and Fanatics contributed $4 million.

Before this calendar year Win for America had received only $2 million from DraftKings. The surge is unmistakable.

Much of the money has flowed through organizations such as American Conservative Fund and American Future which have then directed resources toward state level political activity. The network funded efforts in over a dozen states in Q1 alone spending over $33 million.

In several cases candidates publicly distanced themselves from campaign mailers and advertisements after learning the source of the funding. That backlash is part of the cost of doing business in this environment.

Massachusetts as a Test Case

Massachusetts where DraftKings headquarters are located shows how the regulatory pressure is playing out. The state is considering Sen. John Keenan’s Bettor Health Act which would ban in play and prop betting significantly restrict advertising and increase taxes on sportsbook operators.

The measure advanced from a committee in March but has stalled since then. The legislative session ends in July.

Recent reporting found that DraftKings executives and family members contributed nearly $18,000 to House Speaker Ron Mariano and almost $20,000 to House Ways and Means Chair Aaron Michlewitz earlier this year. DraftKings has also made a $50,000 donation to a nonprofit aligned with Gov. Maura Healey.

Both Mariano’s office and Michlewitz’s office told the reporting outlet that campaign contributions do not influence legislative decision making. The timing still raises questions about how operators navigate these debates.

Risk and Counterarguments in the Spending Strategy

Heavy political spending carries its own risks. In Illinois industry backed groups spent heavily across legislative races with one candidate reporting nearly $200,000 spent attacking him in the weeks leading up to the primary.

Ohio offers another example. In April lawmakers introduced a bill to eliminate online sports betting across the state. Around the same time the American Conservative Fund reportedly spent approximately $1 million supporting select Republican primary candidates.

Similar activity has played out in Alabama New York Pennsylvania Texas and Georgia. In Pennsylvania sports betting interests poured over $8 million into supporting candidates opposing a tax increase. In Georgia gambling linked organizations spent more than $10 million in legislative races. In Texas the American Conservative Fund poured $3.5 million into the affiliated Texas Conservative Fund.

The counterargument is straightforward. This level of spending can backfire when voters or candidates learn the funding source. It can also lock operators into perpetual defense mode instead of focusing on product innovation.

Prop bets in particular face increased scrutiny. Lawmakers regulators and responsible gambling advocates argue the wagers encourage rapid betting activity and have been linked to recent integrity controversies involving athletes. Operators must weigh revenue protection against growing public and legislative pushback.

Ohio Gov. Mike DeWine has called legalizing sports betting his biggest mistake. Lawmakers in nearly a dozen states who previously supported legalization are now backing tighter rules. Some observers describe the trend as legislative buyer’s remorse.

The Bottom Line

Sports betting still drives the majority of revenue even as prediction markets gain executive attention. The $42 million poured into Win for America and the additional millions spent in individual states show operators are prepared to defend that foundation aggressively. After eighteen years across iGaming and sportsbook operations I see this as calculated defense rather than hesitation about new products. The real test will be whether the political investment buys enough runway for prediction market experiments to scale without eroding the core business. Industry executives should track how these state battles resolve before the 2026 elections because the outcomes will shape both revenue streams for years ahead.