IG Group Enters Prediction Markets

IG Group, listed on the London Stock Exchange, plans to launch its prediction markets product in the UK this quarter. The company argues that this step is a natural extension of its existing trading products. Management, noting that this fast-growing sector in the US is not yet well developed in the UK, said investors show strong demand in this area.

The launch will be led by IG Consumer, the company's retail investment division. Chief executive Breon Corcoran said trading, investing and entertainment are coming closer together, and that IG is well placed to seize this opportunity. The company is also considering offering prediction markets alongside cryptocurrency and traditional trading products on a single platform.

Last month, IG applied to the UK Gambling Commission for a betting licence. The application follows the acquisition of Underdog, which was bought for $1.1 billion in July. Regulators had previously indicated that prediction markets would be subject to gambling regulation rather than financial regulation, as they are in the US. As a result, the company may fall under the oversight of both the Gambling Commission and the Financial Conduct Authority.

Alongside its product expansion plans, the company also said its redomiciliation to Jersey is progressing on schedule. This development could fuel speculation about the company's long-term focus and its place in the FTSE 100. However, the lack of a settled legal framework for the sector stands out as the biggest uncertainty facing the project.