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 technology company best known for its 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, made July 31, comes just 13 days after Underdog launched its own CFTC-licensed exchange — the Aristotle Exchange DCM and DCO it acquired in March — making Underdog the fifth licensed US prediction market venue. IG Group CEO Breon Corcoran called the deal '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.' The acquisition is the first time an international financial firm has purchased a licensed US prediction market exchange.

The deal's strategic logic runs in both directions. For IG Group, buying Underdog provides something that would take years to build from scratch: a CFTC-registered designated contract market with an established US user base in sports prediction and daily fantasy, active World Cup trading volume, and an operational exchange infrastructure. IG has extensive regulatory relationships in the UK, EU, Australia, and Singapore, but has not previously held a US CFTC license for event contracts. The Aristotle Exchange licenses that Underdog acquired in March are now IG's entry point into what is projecting to be one of the largest retail financial markets in the United States. For Underdog, IG's capital and global reach provide the resources to compete with Kalshi's $86.5 billion cumulative notional volume and Robinhood's $32.5 billion — a scale gap that Underdog's $6.49 billion, accumulated since September 2025, has not yet closed.

The $1.3 billion valuation reflects Underdog's position as an early-stage but credentialed competitor. For context, Kalshi is targeting a $40 billion valuation and Polymarket was valued at $15 billion in recent reporting; Underdog at $1.3 billion is an earlier-stage business, though one with a licensed exchange, a fantasy sports user base that skews heavily toward engaged sports fans, and a CEO — Jeremy Levine — who framed the acquisition as a platform for global scale rather than an exit. Levine's statement noted that Underdog has 'proven we can build the best products no matter how the regulatory landscape shifts' and that the deal would let Underdog 'bring our products to more audiences.' The regulatory-landscape comment is pointed: Underdog has navigated state-level enforcement actions and a contested federal regulatory environment, and IG's compliance infrastructure and legal resources add meaningful durability to that position.

The acquisition signals that the M&A phase predicted by financial analysts in June is arriving faster than expected. A Bernstein report from late June named Kalshi and Polymarket as potential acquisition targets for Robinhood, Coinbase, and DraftKings, projecting that major financial platforms would seek to buy licensed exchange capacity rather than build it. IG Group's move follows that same logic from a different direction: a global financial firm with no US CFTC presence acquiring a US exchange rather than applying for one. If the pattern holds, the next wave of prediction market consolidation will involve established financial institutions — banks, brokers, trading platforms — acquiring licensed US venues as the sector's volume growth makes the opportunity too large to enter organically.

Operators mentioned in this article

CFTC-regulated

Kalshi

First fully CFTC-regulated US event-contract exchange.

Crypto / On-chain

Polymarket

USDC-settled on Polygon. Largest prediction market by volume.

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