UK betting exchange GGY halves as operators eye US prediction market boom
Gross Gambling Yield from UK betting exchanges has fallen by nearly 50 per cent since 2016, a stark contrast to the booming US prediction market sector which is attracting significant interest and investment from British-based firms, raising questions about domestic regulation.
- Gross Gambling Yield for UK betting exchanges dropped 46 per cent between 2016/17 and 2025/26, falling to £92.66m.
- Several major UK-listed firms have entered the expanding US prediction market space via partnerships and acquisitions.
- UK retail access to prediction markets remains blocked by a ban on binary-option products, though the FCA has held exploratory talks on the matter.
LONDON – The UK’s betting exchange market has experienced a significant downturn, with its Gross Gambling Yield (GGY) falling by 46 per cent between the 2016/17 period and the most recent financial year ending March 2026. The decline has seen GGY shrink from £171.53m to £92.66m.
According to the latest data, betting exchanges now constitute just 3.79 per cent of the total UK GGY. This contraction is steeper than the 26.8 per cent revenue drop seen in high street betting shops over the same timeframe. In contrast, the general remote sportsbook sector has flourished, with its GGY increasing from £1.75bn to around £2.5bn.
Firms pivot to US prediction model
While the domestic exchange model struggles, several UK operators are turning their attention to the rapidly expanding prediction market sector in the United States. This comes as the UK exchange model matures, with Jason Trost, CEO of Smarkets, stating that “betting exchanges have existed in the UK for 20 plus years.” Smarkets has recently updated its own platform to more closely resemble a US-style predictions offering.
Other British companies are making more direct moves. In December, Matchbook became the first UK firm to enter the prediction market space, signing a white label deal with ADI Predictstreet, a partner for the FIFA World Cup prediction markets. Separately, FTSE 250 constituent Plus 500 launched its own US-facing prediction markets product earlier this year through a partnership with Kalshi. In another significant move, listed firm IG Group recently acquired Underdog, a US daily fantasy sports (DFS) platform.
Regulatory uncertainty clouds UK potential
The potential for a similar prediction market boom in the UK is currently constrained by financial regulations. A ban on unlicensed binary-option style products effectively blocks retail customer access to these markets. However, there are early signs of a potential policy shift, with the Financial Conduct Authority (FCA) having recently held exploratory talks about potentially relaxing these restrictions.
While the UK deliberates, other jurisdictions are being more proactive. Gibraltar has already established the world's first standalone regulatory framework designed specifically for prediction market products. The growing global interest in the vertical is set to be a key topic at the upcoming Global Prediction Market Forum, scheduled to be held in Lisbon on 1 October.
