IG Group Buys Underdog for $1.3 Billion — The First Major Foreign Acquisition of a US Prediction Market Exchange
IG Group, the UK-listed financial trading platform, has agreed to acquire Underdog for approximately $1.3 billion — 13 days after Underdog launched its own CFTC-licensed exchange. The deal gives IG Group a US designated contract market and clearing organisation, making it the first international financial firm to acquire a licensed US prediction market venue. Underdog is currently the third-largest US prediction market by regulated notional volume.
IG Group, the UK-listed financial technology company operating spread-betting and CFD platforms across 17 countries, has agreed to acquire US prediction market and daily fantasy sports operator Underdog for approximately $1.3 billion. The announcement on 31 July comes just 13 days after Underdog launched its own CFTC-licensed exchange — the Aristotle Exchange DCM and DCO it acquired in March — making it the fifth licensed US prediction market venue. IG Group CEO Breon Corcoran described the deal as 'a decisive step in IG's long-term strategy to build a global consumer engagement platform that capitalises on the rapid convergence of trading, investing and entertainment.' It is the first time an international financial firm has purchased a licensed US prediction market exchange.
For UK readers, the significance is direct. IG Group is one of the UK's best-known retail trading platforms, LSE-listed, regulated by the FCA and familiar to hundreds of thousands of UK spread-betters and CFD traders. The Underdog acquisition gives IG a CFTC-registered US exchange — a regulatory credential it does not currently hold — and a sports-focused US user base. IG has regulatory relationships in the UK, EU, Australia, Singapore, and South Africa; Underdog brings the US CFTC licence. The combined entity is the first prediction market operator with simultaneous FCA and CFTC regulatory presence, which is the structural prerequisite for a product that could eventually bridge UK and US markets.
The $1.3 billion valuation is significantly below Kalshi's $40 billion target and Polymarket's $15 billion, reflecting Underdog's earlier-stage position — $6.49 billion in cumulative notional volume since September 2025, versus Kalshi's $86.5 billion. But the Aristotle Exchange licences that come with Underdog are what IG is buying as much as the volume: a CFTC-registered DCM and DCO is a regulatory asset that cannot be replicated quickly, regardless of capital. Underdog CEO Jeremy Levine noted that the company had 'proven we can build the best products no matter how the regulatory landscape shifts' — a reference to the ongoing state-level enforcement actions and federal preemption litigation that has tested every US prediction market operator in 2026.
The deal follows the pattern predicted by a Bernstein report in late June, which named Kalshi and Polymarket as likely M&A targets for established financial platforms. IG Group's move confirms the logic from a different angle: rather than a US platform buying prediction market capacity, a global financial firm is buying a US licence. If other international trading platforms — European banks, Asian brokers, UK spread-betting firms — follow the same strategy, the consolidation of US prediction markets will increasingly be driven by inbound foreign acquisition rather than domestic merger.
Operators mentioned in this article
Recent updates
Missouri AG Sends Cease-and-Desist Letters to Six Prediction Market Operators
Missouri AG Catherine Hanaway issued cease-and-desist letters on September 18 to Kalshi, Polymarket, Robinhood, Crypto.com, Novig, and Underdog — the broadest single-state enforcement sweep yet. The letters give platforms 30 days to comply or obtain state gambling licences. Missouri alleges sports event contracts are unlicensed sports wagering. One day earlier, Montana agreed to pause its own Kalshi enforcement pending the Ninth Circuit en banc process.
Yahoo Finance Ends Polymarket Data Partnership After Five Months
Yahoo Finance and Polymarket ended their exclusive prediction market data partnership on September 18, five months after announcing it in November 2025. The dedicated Polymarket hub on Yahoo Finance was taken down in April 2026 after a two-month run. No reason disclosed. Yahoo Finance retains an advertising relationship with Polymarket. The partnership's failure is a setback for Polymarket's mainstream financial media distribution strategy.
Montana and Kalshi Reach Joint Stipulation — State Pauses Enforcement Pending Ninth Circuit En Banc
Kalshi dismissed its lawsuit against Montana on September 17 after both parties filed a joint stipulation in which Montana agreed to pause all enforcement pending the outcome of Kalshi's en banc petition at the Ninth Circuit. Montana must give 30 days notice before resuming once the en banc window closes. The agreement mirrors the Robinhood-Michigan stipulation of September 4 and reflects a pattern of negotiated appellate-linked pauses.