yes it is nothing but online gambling, legal because of a loophole which will probably be filled shortly.
"A frequent question people looking in to daily fantasy sports sites have is, “Is DraftKings a scam?” They ask this because they know that gambling online is illegal, yet this site claims to offer real money prizes betting on fantasy sports. The truth is, the site is 100% legit and 100% legal (except for residents of Arizona, Iowa, Louisiana, Montana, Washington, and Quebec due to state-specific laws).
Due to a loophole in the 2006 law that made online gambling illegal, this and other daily fantasy sports sites are able to pay out real money.
The law that made online gambling illegal, 2006’s Unlawful Internet Gambling Enforcement Act, explicitly carved out an exemption for fantasy sports online. This was done because millions of Americans use websites to run their season-long fantasy leagues.
Since money is often wagered on this, suddenly millions of people would find themselves on the wrong side of the law. In order to prevent this, fantasy sports were exempted from these rules.
These same rules apply to daily fantasy sports. The only difference between season long fantasy sports and daily fantasy sports is the length of a particular game."
so the law was meant to protect season long fantasy football, but also allows daily fantasy football wagering. that will change shortly I'm sure