Underdog, a US sports gaming operator, has acquired Aristotle Exchange DCM and Aristotle Exchange DCO, entities registered with the Commodity Futures Trading Commission (CFTC) as a designated contract market (DCM) and derivatives clearing organization (DCO).
The acquisition allows Underdog to operate its own federally compliant prediction market exchange and broaden access to event-based contracts within its ecosystem.
The operator first introduced access to sports prediction markets in its app in September, acting as an intermediary to other exchanges.
Underdog CEO and co-founder Jeremy Levine said: “We look forward to working with the CFTC to offer an exchange that brings even more options to enjoy sports to our customers.”
Levine added: “We’re in the early innings of what prediction markets can be, especially for sports fans.”
The operator said its exchange will provide customers with access to sports event contracts and additional market offerings. It intends to expand its prediction market portfolio under its own platform following the acquisition.
Aristotle Exchange’s financial advisor on the transaction was Lazard, while its legal advisor was Willkie Farr & Gallagher LLP.
The move follows broader growth in US prediction markets, with operators exploring exchange-based models alongside traditional sportsbook and fantasy formats. Underdog has increasingly focused on alternative wagering structures as it shifts away from conventional sportsbook operations in certain jurisdictions.
Earlier this year, Underdog’s responsible play innovation fund GuardDog invested in savings platform Regen, integrating financial wellness tools into its responsible gaming framework and expanding support for player protection initiatives across its products.
Underdog previously offered prediction markets through third-party exchanges before acquiring its own regulated infrastructure
