Bank of America has identified potential risks to shares of Flutter Entertainment and DraftKings stemming from fee changes at Kalshi, a competing prediction market platform.
Analysts at BofA Securities, led by Ryan Sigdahl, noted in a Monday research note that adjustments to Kalshi’s fee structure could intensify competition in the U.S. prediction market sector. The changes may pressure margins for established players like Flutter and DraftKings, which operate in the same space.
Kalshi, which has faced regulatory scrutiny over its business model, recently adjusted its fee framework to comply with evolving requirements. The adjustments could attract more users to Kalshi, analysts said, potentially diverting market share from competitors.
Flutter, owner of FanDuel, and DraftKings are the dominant publicly traded firms in the U.S. prediction market industry. Both companies have expanded aggressively in recent years, but their growth trajectories could be impacted if Kalshi gains traction due to its fee revisions.
BofA’s note highlights regulatory and competitive risks as key factors to watch in the sector. The firm did not specify the magnitude of the potential impact on Flutter or DraftKings but emphasized the need for investors to monitor Kalshi’s evolving market position.
