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Novig receives regulatory approval for shift from sweepstakes to prediction market model

Legal Writer

Publish Date: Jun 17, 2026

Fact checked by: Matt Moreno

Key Points

Novig announced CFTC approval for its exchange on Tuesday.
Company plans to launch new peer-to-peer trading platform in late summer 2026.
Novig follows ProphetX in moving away from sweepstakes model.

Within the context of sports-focused online trading platforms, the abandonment of sweepstakes models in favor of prediction market exchanges is on. Novig is the second notable brand to make the move following regulatory approval from the United States government.

Prediction market exchanges provide a more secure future for companies like Novig in comparison to sweepstakes due to government intervention. However, the sweepstakes framework may endure within the context of casino gaming.

novig-pro-contra

Novig publicizes plans to relaunch sports trading platform

Novig announced in a Tuesday press release that its designated contract market application with the U.S. Commodity Futures Trading Commission (CFTC) received approval. Novig submitted the application in January, establishing a new precedent for rapid CFTC approvals.

Novig has been operating in select U.S. states on a peer-to-peer model that uses a dual-currency sweepstakes framework to award prizes to players who make accurate predictions about sporting events. Later this summer, though, Novig will close out the sweepstakes component.

Instead, Novig will offer event contracts connected to the outcomes of sporting events. Users can buy positions in those markets on the “yes” or “no” side.

People who purchase contracts on the winning side will receive payouts according to the price at which they entered the market. Contract prices reflect users' confidence that the stated premise will or will not play out as described.

The result will be a familiar experience for Novig users, albeit on different legal footing. That legal footing could make all the difference for Novig’s future.

Why Novig and others are moving away from sweepstakes models

Although the legal and technical discussions may be more than many sports fans are interested in, the difference between operating as a prediction market exchange and a sweepstakes website for Novig could prove to be significant. Novig is following another former sweepstakes sports trading platform, ProphetX, in making the move.

The main difference comes down to the regulatory structures for the frameworks. Sweepstakes are subject to an array of federal, local, and state statutes in the U.S., while numerous federal and state agencies have oversight in some capacity.

Meanwhile, the CFTC maintains that it has exclusive regulatory authority over prediction market exchanges in the U.S. That claim is being adjudicated in numerous courts right now, but it is the status quo barring a Supreme Court ruling that would alter the situation.

Several U.S. states have enacted laws explicitly banning sports trading operating on a dual-currency sweepstakes model, including the populous states of California and New York. In comparison, the CFTC holds that its oversight makes registered prediction market exchanges legal to use everywhere in the U.S.

That legality only applies within the context of contract markets based on sporting event outcomes, though. Casino games are different, and that may be a place where sweepstakes websites continue to operate.

Casino games may still be viable territory for sweepstakes sites

Prediction markets are less viable for games like baccarat, blackjack, craps, roulette, and slots online, as proposed CFTC rules for exchanges would ban contracts based on those outcomes. That means sweepstakes casinos could continue to serve customers in the U.S., at least in jurisdictions that have not restricted or do not in the future outlaw the games. For now at least, sweepstakes-based online slots will continue to spin.

Sweepstakes-based sports trading platforms will increasingly be more difficult for people in the U.S. to find, though. Operating as a prediction market platform simply provides a clearer path to a larger number of potential users.

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