Underdog Launches Its Own CFTC-Regulated Prediction Market Exchange

Over the previous weekend, Underdog officially launched its own prediction market exchange and is no longer relying on a third-party exchange.

This move comes after the company bought Aristotle Exchange DCM and Aristotle Exchange DCO several months ago. This gave Underdog the pieces needed to launch its own exchange.

According to a press release, they're licensed by the Commodity Futures Trading Commission, and thus, this will "provide Underdog customers even more ways to express their opinions on sports, culture and beyond, all within the existing Underdog app."

Underdog offered sports predictions dating back to last September, but used other exchanges like Crypto.com and Kalshi. In fact, they were the first sports gaming operator to dip into the prediction market space. 

Underdog Shifts From Third-Party Exchanges

Underdog CEO and co-founder had this to say about the move:

“We started this company with a clear belief – there is so much more to be built for sports fans in America. Despite incredible changes in the U.S. market in recent years, through the twisting journey from fantasy sports to regulated sports betting to prediction markets, we still see an industry that far too often simply misses in serving sports fans.

“Now with our own exchange, we’re going to unlock so much for more sports fans. Prediction markets are largely about sports, and Underdog is the best at sports.”

Company Fully Embraces Prediction Markets

With rising sports betting taxes across some states, more sports betting operators are getting into the prediction market industry. Other examples include DraftKings and FanDuel, but in this case, Underdog ditched sports betting altogether, including closing down its first online sportsbook, which launched in North Carolina. 

Underdog also secured market access in Missouri for online sports betting through a partnership with the Kansas City Royals, but that never materialized. 

With the North Carolina sportsbook closing in December 2025, Underdog said goodbye to sports betting, and now the popular DFS operator is all in on prediction markets.