Should Meta Buy a Prediction Market? ProphetX’s Dean Sisun Has Ideas
Meta is reportedly building its own prediction markets platform. Sisun, the co-founder of a nascent exchange, says there's already a model for the tech giant to follow.
After news broke this week that Facebook’s parent company is building a prediction markets app, a former ProphetX employee had a thought: Acquiring an exchange could be Meta’s best path into the space.
There’s massive potential, the rationale goes, with funneling billions of active users into a prediction markets platform.
Robinhood’s 28ish million users are a fraction of Facebook’s three or so billion, and Dean Sisun, co-founder and CEO of ProphetX, can envision the financial trading app’s prediction market model being replicated – and to an nth degree.
“I promise you, I didn’t have him plant that tweet,” Sisun clarified of Sam Schwartz’s post, made a day before we spoke.
That said, he seems to like the idea.
Robinhood, which used to send all its prediction market traffic to Kalshi, acquired MIAXdx, a DCM and DCO, last November. Partnering with market maker Susquehanna, it relaunched the exchange as Rothera earlier this month.
“I think what Robinhood did is so interesting, the JV model they put together,” Sisun, whose company was approved as a DCM and DCO by the CFTC about two weeks ago, told Gambling Insider.
The joint venture, Sisun explains, includes the three essential pieces of a prediction market: a platform, a market maker, and distribution.
“You get every facet of the pie,” Sisun said. “You have the exchange, you have the market maker, and then you have the distribution flow, and then it’s just a game of how you split it up between the three of you. …
“I think that is the model that a big company like Meta should be following.”
Exchange Could Take Years to Build; Buy One Instead
While Meta’s initial plans call for video-game-like points to be traded on “Arena” – the working title of the prediction markets app – it has not ruled out using real money at some point, according to the New York Times’ original report on the company’s build.
Sisun does not believe transitioning from points to dollars would be too difficult for a company like Meta.
“If they launched either a product or a wallet within some of their products, they could get a lot of funds on site very quickly,” he said.
If it’s serious about competing in the space and wants to get up and running in short order, Meta may be better off buying rather than building.
Meta, which also owns Instagram, WhatsApp and Messenger, has the distribution, of course, and once funds are turned on, “then they would have to find an exchange to own and a market maker to partner with,” Sisun said.
“If you’re sitting on the king of distribution, I think the other two are probably assets you wanna buy just to move as quickly as possible. If you wanna build them yourself, it’s gonna take probably years to do that. So if I’m them, I’m probably buying someone in the space.”
Will Other Tech Megacorps Join the Prediction Markets Party?
While a tech behemoth has yet to arise itself as a prime competitor in the sports betting industry, prediction markets may be too great an opportunity to pass up.
In a 2017 report about the future of sports betting, before the repeal of PASPA, ESPN’s David Purdum and Ryan Rodenberg wrote, “Some of the world’s largest tech companies are expected to emerge as bookmaking giants that will compete against established U.S. and international sportsbook operators, state lotteries, Native American gaming interests and fantasy sports sites for a share of the market.”
As he was standing up his company in 2018, Sisun recalls Microsoft having applied for a patent for a sports betting exchange.
“I always thought maybe they would try to do something,” he said.
And this week’s news about Meta prompts the question about what other companies have prediction markets in their sights.
“Is Amazon gonna do something? In prediction markets? Is it gonna be sports focused? Is it gonna be news focused? Is it gonna be crypto focused?,” Sisun pondered.
“It makes you wonder, if Meta is doing this, who’s next?”
Sisun’s comments about the Meta news were part of a broader discussion with Gambling Insider. We’ll have more from our conversation in the coming weeks.
Gambling Insider delivers the latest industry news, in-depth features, and operator reviews that you can trust. Our team combines rigorous editorial standards with decades of specialized expertise to ensure accuracy and fairness. We are committed to delivering clear, impartial, and dependable coverage across the global gambling sector.
