Novig files DCM registration application with CFTC
Sweepstakes operator submits request with financial derivatives regulator as part of plan to become federally regulated
Novig has applied to the Commodity Futures Trading Commission (CFTC) to secure a designated contract market (DCM) license and pave the way to become a federally regulated prediction markets platform.
As per CFTC filings submitted last week, Novig applied for the license under the Ludlow Exchange LLC banner. The application was signed by co-founder and CEO Jacob Fortinsky.
As part of the request, Ludlow Exchange is listed with a New York address.
The DCM application is currently listed as pending with the CFTC. However, DCM approval notoriously could take years.
Railbird (since acquired by DraftKings) and QCEX (since acquired by Polymarket) applied for DCM status in 2022. They were approved by the CFTC in 2024.
Novig already has an in-house trading team and has been planning on entering the prediction markets space since last August.
The firm was initially a commission-free sports betting operator in Colorado but pulled out of the state in April 2024 – four months after its launch.
In September, it returned but under the guise of a sweepstakes operator across 43 US jurisdictions.
Then, a month later, Novig secured $18m in Series A funding with the plan to add new markets, sports, and integrate a host of new features including event contracts.
Speaking after the funding, Fortinsky said what the operator was building “isn’t just sports predictions – it’s a true peer-to-peer market.”
The request with the CFTC follows in the footsteps of ProphetX, which had been operating as a sweepstakes operator and filed to become a DCM and derivatives clearing organization in November.
Recent months have seen several operators enter the sports event contracts space, including FanDuel, DraftKings, Fanatics, Prizepicks, and Underdog Fantasy.
The request with the CFTC follows in the footsteps of ProphetX, which had been operating as a sweepstakes operator and filed to become a DCM and derivatives clearing organization in November.
Recent months have seen several operators enter the sports event contracts space, including FanDuel, DraftKings, Fanatics, Prizepicks, and Underdog Fantasy.
This led to several states, including Tennessee and Massachusetts, sending cease-and-desist letters to prediction market platforms.