FanDuel’s blockbuster announcement Wednesday that it is partnering with derivatives marketplace CME to launch a prediction market brings more questions than answers. How will state regulators react? Will this make negotiating with California’s tribes more difficult?

CME Group Inc. is ready to break into the sports-prediction market if its new partner FanDuel chooses, building on the exchange operator’s ambitions to reach a broader audience.

The sports-betting platform’s deal with exchange giant CME Group to offer event-based contracts could lead to it making markets for sports-related events, said analysts.