Underdog has acquired Commodity Futures Trading Commission-registered Aristotle Exchange to push ahead with its prediction markets expansion plans.
The swoop for Aristotle Exchange is about acquiring a designated contract market (DCM) and derivatives clearing organization (DCO) to allow Underdog to take full ownership of its offering.
Currently, Underdog offers prediction markets via Crypto.com. In that relationship, Underdog acts as a broker for CFTC-licensed Crypto.com’s DCM and DCO.
Aristotle was approved by the federal derivatives regulator in September. It also powers PredictIt – a prediction markets platform focused on current events and elections that’s owned by the Victoria University of Wellington in New Zealand.
Lazard served as Aristotle’s financial adviser, while Willkie Farr & Gallagher was its legal adviser throughout the process of the deal, though the cost of the transaction hasn’t been disclosed.
The acquisition comes a week after at least 125 redundancies were reported at Underdog as part of its prediction markets pivot.
Jobs were cut across various departments, including compliance, fraud operations, HR, trading, and product development.
The company said the restructuring wasdue to the fact running prediction markets are “simply a different operation”.
Underdog’s prediction markets product is live in 32 US jurisdictions, including California and Texas.
The operator had previously expanded into online sports betting by first launching in North Carolina and then securing access to Missouri.
However, the unicorn, which was valued at $1.2bn last year, pulled out of both states to pursue prediction markets instead.
On the Aristotle acquisition, Jeremy Levine, Underdog CEO, said: “We look forward to working with the CFTC to offer an exchange that brings even more options to enjoy sports to our customers.
“We’re in the early innings of what prediction markets can be, especially for sports fans. We’ll use this opportunity to bring the same relentless focus on innovation and experience that we’ve always brought to our customers.
“The reality is, prediction markets are primarily about sports and no company knows how to engage with sports fans and create products for sports fans better than Underdog.”
The acquisition is the latest in the prediction markets space in which smaller CFTC-approved platforms have been acquired by larger players.
DraftKings snapped up DCM and DCO Railbird last year to support its push, while Robinhood teamed up with Susquehanna to acquire CFTC-regulated MIAXdx in January.
The post Underdog acquires CFTC-approved Aristotle Exchange first appeared on EGR Intel.
Underdog has acquired Commodity Futures Trading Commission-registered Aristotle Exchange to push ahead with its prediction markets expansion plans. The swoop for Aristotle Exchange is about acquiring a designated contract market (DCM) and derivatives clearing organization (DCO) to allow Underdog to take full ownership of its offering. Currently, Underdog offers prediction markets via Crypto.com. In that relationship, Underdog acts as
The post Underdog acquires CFTC-approved Aristotle Exchange first appeared on EGR Intel.