IG Group to acquire Underdog for up to $1.3 billion
Britain's IG Group agreed to acquire U.S. prediction markets operator Underdog for up to $1.3 billion, the UK-listed brokerage said Thursday. Underdog ranks as the third-largest U.S. prediction markets venue by regulated notional volume flow, behind Kalshi and Robinhood. The deal was announced just 12 days after Underdog launched prediction markets through its own federally regulated exchange, UDX. IG Group said the acquisition will establish it as a leader in U.S. prediction markets. No further terms or timeline were disclosed.
Underdog's UDX launch less than two weeks before the IG deal gives the UK brokerage a fully owned CFTC-regulatory stack from day one. That spares IG the years of licensing delay and the partner-fee drain that white-label reliant platforms face. Kalshi and Crypto.com now confront a third major competitor with captive infrastructure and a fresh billion-dollar balance sheet.
For Underdog, the sale validates the vertical-integration model DraftKings proved with DKeX. The deal also narrows the window for smaller fantasy platforms still renting regulatory rails. They must now raise faster, sell cheaper, or build their own stacks before the remaining strategic buyers pick their targets. IG's entry price sets a floor that makes bolt-on acquisitions costlier for everyone else.
Underdog's UDX launch about two weeks ago and IG's buyout now make the second and third major vertical-integration moves in the prediction-markets sector this quarter, after DraftKings' DKeX debut, showing fantasy operators are racing to own full CFTC-regulatory stacks rather than rent them.