Motivated by community detection, we characterise the spectrum of the non-backtracking matrix $B$ in the Degree-Corrected Stochastic Block Model. Specifically, we consider a random graph on $n$ vertices partitioned into two equal-sized clusters. The vertices have i.i.d. weights $\{ \phi_u \}_{u=1}^n$ with second moment $\Phi^{(2)}$. The intra-cluster connection probability for vertices $u$ and $v$ is $\frac{\phi_u \phi_v}{n}a$ and the inter-cluster connection probability is $\frac{\phi_u \phi_v}{n}b$. We show that with high probability, the following holds: The leading eigenvalue of the non-backtracking matrix $B$ is asymptotic to $\rho = \frac{a+b}{2} \Phi^{(2)}$. The second eigenvalue is asymptotic to $\mu_2 = \frac{a-b}{2} \Phi^{(2)}$ when $\mu_2^2 > \rho$, but asymptotically bounded by $\sqrt{\rho}$ when $\mu_2^2 \leq \rho$. All the remaining eigenvalues are asymptotically bounded by $\sqrt{\rho}$. As a result, a clustering positively-correlated with the true communities can be obtained based on the second eigenvector of $B$ in the regime where $\mu_2^2 > \rho.$ In a previous work we obtained that detection is impossible when $\mu_2^2 < \rho,$ meaning that there occurs a phase-transition in the sparse regime of the Degree-Corrected Stochastic Block Model. As a corollary, we obtain that Degree-Corrected Erd\H{o}s-R\'enyi graphs asymptotically satisfy the graph Riemann hypothesis, a quasi-Ramanujan property. A by-product of our proof is a weak law of large numbers for local-functionals on Degree-Corrected Stochastic Block Models, which could be of independent interest.