From Sweeps to Swaps: Fliff Joins Growing Sweepstakes Sportsbook Pivot to Prediction Markets

Fliff, one of many extra distinguished social sportsbooks constructed on a sweepstakes mannequin, is taking a proper step towards the federally regulated prediction market trade by having a brand new affiliate apply to turn into a Futures Commission Merchant (FCM).

Fliff FCM LLC filed with the National Futures Association (NFA) on Aug. 12 for FCM registration and NFA membership, whereas additionally in search of approval as a swap agency. All three purposes stay pending. An FCM can function the customer-facing middleman for contracts listed on a Commodity Futures Trading Commission-regulated alternate, which means Fliff wouldn’t want to function its personal Designated Contract Market (DCM) to provide prediction markets.

The transfer places Fliff in an more and more acquainted firm. ProphetX, which beforehand operated as a sweepstakes sportsbook, relaunched in June as a federally regulated prediction market after receiving DCM approval. Novig adopted this month, relaunching nationwide via its CFTC-regulated Ludlow Exchange after beforehand utilizing the sweeps mannequin.

More seem to be following. Onyx Odds, a sweepstakes-based social sportsbook, has been making ready its personal prediction market providing and had a brand new affiliate, Onyx Markets LLC, file for FCM registration on Aug. 12, the identical date as Fliff. Rebet, which mixes a social sportsbook and sweeps on line casino in the identical app, has had an FCM application pending via Rebet Predictions LLC since June 11. MyPrize, a sweepstakes on line casino moderately than a sportsbook, has additionally announced plans for a prediction market product.

The migration comes because the broad state entry that helped make sweepstakes gaming enticing has more and more come underneath strain. States have enacted bans, issued cease-and-desist orders, and in any other case challenged operators that supplied sportsbook- and casino-style merchandise with out standard gaming licenses. Prediction markets provide a unique regulatory route via the federal commodities framework, however sports activities occasion contracts are already producing their very own battles with states over whether or not federal regulation preempts state playing legal guidelines.

The sweepstakes route for iGaming operators begins to slender

The sweeps mannequin supplied gaming startups an interesting different to the standard U.S. regulatory map. Rather than pursuing sportsbook or on-line on line casino licenses state by state, operators structured their merchandise round sweepstakes guidelines, sometimes providing a free-play forex alongside a promotional forex that might be redeemed for money prizes. That allowed some platforms to launch throughout a lot of the nation whereas avoiding the licensing charges, gaming taxes, and different necessities imposed on state-regulated sportsbooks and casinos.

The mannequin has at all times rested on a disputed authorized premise. Operators have maintained that their merchandise adjust to sweepstakes legal guidelines, whereas state regulators and the regulated gaming trade have more and more argued that dual-currency platforms providing sportsbook- or casino-style video games quantity to unlicensed playing.

Over the previous two years, that disagreement has become a wave of legislation and enforcement, with states utilizing outright bans, cease-and-desist orders and different actions to push sweeps operators out.

Fliff sweeps contraction

For Fliff, the once-broad map has already contracted significantly. Its present sweepstakes rules prohibit Fliff Cash play in 20 states, together with main markets similar to California, New York and Michigan. Arizona regulators particularly ordered Fliff to stop providing what they characterised as unlicensed occasion wagering final yr, whereas newer state legal guidelines have continued shrinking the trade’s potential footprint. California’s dual-currency sweeps ban took effect Jan. 1, whereas Indiana and Maine additionally enacted new prohibitions this yr.

Prediction markets have emerged as one other potential route to broad U.S. distribution because the sweepstakes route is narrowing. Registering with the CFTC or NFA carries substantial upfront and ongoing regulatory necessities, however the federal framework affords a essentially totally different proposition: entry via a single derivatives regulatory system moderately than securing separate gaming licenses in each state the place an operator desires to provide its merchandise.

For sports-focused sweeps corporations watching their state maps contract, that distinction is changing into more and more important.

Fliff had already signaled prediction market plans

Fliff’s roots are firmly in sports activities. Founded in 2018, the corporate constructed its enterprise round a social sportsbook that pairs free-play Fliff Coins with redeemable Fliff Cash sweepstakes contests. 

The firm has steadily expanded past that unique mannequin. In 2024, Fliff acquired the consumer technology and engineering group behind Mojo, the previous athlete buying and selling alternate. Fliff co-founder and CEO Matt Ricci stated on the time that buying Mojo’s platform supplied “an instantaneous path to speed up product growth.” Fliff adopted with the Sidepot sweepstakes on line casino in 2025, then launched its peer-to-peer Superstars DFS product, now referred to as Fliff Pick’Em, at the beginning of 2026, across the similar time that California’s sweeps ban took impact.

By late June, Fliff was publicly signaling its subsequent growth. A Director of Compliance job posting stated the corporate was making ready “upcoming prediction market initiatives” and wished the rent to lead its CFTC compliance technique throughout a enterprise spanning social sportsbook, DFS and prediction markets.

Fliff stated the compliance director would “construction occasion contracts and prediction market merchandise,” together with contract phrases and market integrity guidelines, and “lead regulatory registrations, purposes, and filings underneath FCM frameworks.” The posting additionally referred to as for expertise with the Commodity Exchange Act and CFTC and NFA guidelines governing event-based merchandise.

The Aug. 12 NFA filing now places these plans into movement. What stays unclear is which DCM would listing the contracts Fliff intends to provide, when the product may launch, and whether or not prediction markets could be built-in into the present Fliff platform. The firm has not but publicly introduced an alternate associate.

Onyx provides one other piece to its prediction market plans

Onyx Odds seems to be additional alongside in an analogous transition. The social/sweepstakes sportsbook already has a federally registered affiliate, Onyx Predictions LLC, which turned an Introducing Broker (IB) and NFA member on May 20. The IB is assured by NinjaTrader Clearing, which carries buyer accounts and funds. But Onyx’s regulated prediction market product has not but broadly launched. Its website presently invitations customers to “join early entry” and request entry to a non-public beta.

The firm had already signaled plans to construct out its federal regulatory construction. An listed model of an April job posting for a Regulatory Operations Associate stated the rent would “personal and drive CFTC licensing efforts (DCM, FCM, IB as relevant)” and assist Onyx “get licensed and function in regulated markets.” Onyx had additionally announced a partnership with Polymarket final November to launch CFTC-regulated sports activities occasion contracts.

On Aug. 12, one other affiliate, Onyx Markets LLC, filed with the NFA for FCM registration, NFA membership and swap-firm approval, with all three purposes proven as pending.

The submitting comes lower than two months after Payward, the mum or dad of Kraken and NinjaTrader, led a $20 million Series A funding round that valued Onyx at $220 million. Onyx stated on the time that it might use Payward’s regulated U.S. derivatives infrastructure to energy its prediction market providing. Why Onyx is now in search of its personal FCM registration regardless of the present infrastructure relationship is unclear, although approval may give the corporate higher management over the customer-facing facet of its regulated enterprise.

The partnership can be set to broaden Onyx past sports activities and prediction markets. Its web site says direct crypto buying and selling is coming this fall and advertises entry to greater than 500 tokens, whereas the Payward deal particularly requires embedding crypto buying and selling contained in the Onyx app alongside the federally regulated prediction market providing.

Two sweeps sportsbooks have already made the bounce

The ProphetX and Novig transitions additionally present what the federal route can imply for geographic attain. Before its June relaunch, ProphetX stated its sweepstakes product was obtainable in about 40 states. Its federally regulated alternate launched in 49 states, with solely Nevada excluded from its availability map. The transfer supplied the primary instance of a sports-focused sweepstakes platform changing to the federal prediction market framework.

Novig’s sweeps rollout initially reached 42 states and Washington, D.C., however by January its footprint had narrowed to 36 states and D.C. Its regulated platform is now obtainable in 47 states, with Arizona, Michigan and Nevada excluded. The transition didn’t require rebuilding the alternate from scratch. Shortly after Ludlow acquired CFTC approval, Novig co-founder and CTO Kelechi Ukah told DeFi Rate that the designation “doesn’t begin a construct for us, it merely turns the regulated layer on high [of] our already confirmed infrastructure.”

When Novig accomplished the change in August, it retired the redeemable Novig Cash and nonredeemable Novig Coins used underneath its sweeps mannequin and moved buying and selling fully to U.S. {dollars}. ProphetX likewise describes sweepstakes as its former mannequin following its federal relaunch. Whether Fliff and Onyx intend to make the identical clear break stays unclear. 

Two paths to federal entry face acquainted state problem

Novig and ProphetX took a extra bold regulatory route than the operators now pursuing FCM or IB registrations. They management their very own DCMs, permitting them to create and listing sports activities contracts immediately, whereas Fliff, Onyx and Rebet may as an alternative distribute contracts listed by an outdoor alternate. The result’s two totally different paths rising for sweeps sportsbooks trying to transfer into the federal market.

The broader attain shouldn’t be assured to final. Some of the identical states which have spent the previous couple of years proscribing sweepstakes sportsbooks are actually difficult federally regulated sports activities occasion contracts, arguing that the merchandise violate state playing legal guidelines regardless of CFTC oversight.

For sports-focused operators making the bounce to prediction markets, the federal framework might provide a wider beginning map than sweepstakes, however the boundaries of that entry are nonetheless being contested in courts and regulatory proceedings throughout the nation.

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