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
An Independent Integrity Body Found 7 Betting Irregularities at the World Cup. FIFA Said There Were None. The Clash Centres on Polymarket.
The Group of Copenhagen — the Council of Europe's independent match manipulation watchdog — raised seven yellow notices for potential betting irregularities during the 2026 World Cup, directly contradicting FIFA's all-clear published on Tuesday. The most troubling finding involves Polymarket: the platform opened a market on 2 July asking whether Folarin Balogun would play against Belgium — the same day Balogun received a red card, three days before FIFA publicly confirmed his ban was suspended. No equivalent markets were opened for any of the other 14 red cards at the tournament.
After Tuesday's Hearing, Congress Looks Ready to Legislate on Prediction Markets — Not Just Watch
The House Agriculture Subcommittee held a two-hour hearing on 22 July examining sports event contracts, with witnesses from the American Gaming Association, tribal gaming, and both sides of the CFTC authority debate. Chair Dusty Johnson said Congress 'cannot afford to be silent' and signalled there is 'work for them to do.' Witnesses urged members to advance H.R. 7840, the Event Contract Enforcement Act, which would ban sports event contracts outright.
Bloomberg Found $200 Million in Suspicious Wagers on Kalshi and Polymarket. An Army Sergeant Has Already Been Indicted.
A Bloomberg investigation identified approximately $200 million in suspicious wagers on Kalshi and Polymarket between January and June 2026, concentrated in geopolitical event markets. A US Army Master Sergeant has been indicted for using classified information about the operation that captured Venezuelan President Maduro to generate $409,000 in profit. 57% of unusually successful wallets were created within 24 hours of placing their bets. The House Oversight Committee has launched a formal investigation.