Mark Zuckerberg has reportedly directed Meta to build a prediction markets app called "Arena," according to a New York Times report citing two anonymous employees. Meta has not commented and the report has not been independently verified. The app would function independently from Facebook, Instagram, WhatsApp, and Messenger and is being built by a small team to compete directly with Polymarket and Kalshi. The initial version will probably use a video game-like points system instead of real money wagers, though Meta reportedly hasn't ruled out letting users bet real money eventually. DraftKings and FanDuel parent Flutter Entertainment both dropped more than 2% on the news as the market priced in what it means to have a company with 3 billion users entering this space. Worth noting that Meta has tried this before. In 2020 the company launched Forecast, a crowdsourced prediction app using a points system, and shut it down in 2022. Meta has historically struggled to get standalone apps adopted outside its core social networking products. Insiders cautioned that Arena remains in development and may never be released. The timing is notable regardless. Prediction markets exploded in popularity during the 2024 presidential election. Polymarket is reportedly raising at a $15 billion valuation. Kalshi partnered with Nasdaq. The CFTC is actively working on a formal regulatory framework with a proposal currently under White House review. Robinhood and Interactive Brokers have both rolled out event contracts. If the report is accurate, the largest social media company in the world wants in.