Ask anybody who suffered the recent bloodletting at HedgeStreet: CFTC regulation can impose crushing burdens. It has nearly driven that innovative business into the ground.

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That was Tom W. Bell, of course. And 5 months after Tom W. Bell&#8217-s pronouncement, HedgeStreet v1 ate the bullet and bellied up.

Doctor Pennock, isn&#8217-t &#8220-pragmatism&#8221- to take into perspective the hard facts povided by:

  1. the bankruptcy of the CFTC-regulated HedgeStreet v1,
  2. and the insolent health of the UK Gambling Commission-regulated BetFair?

Shouldn&#8217-t the &#8220-pragmatists&#8221- draw lessons from all that?

Or will the the &#8220-pragmatists&#8221- ignore the hard facts?

Of, yeah, please, let&#8217-s display &#8220-pragmatism&#8221-.

Back in your court, doc.

Here&#8217-s Tom W. Bell&#8217-s old take that prediction markets fall outside of the CFTC&#8217-s jurisdiction.

IG Group buys HedgeStreet for $6,000,000.

Just as predicted by our Deep Throat in early October 2007 &#8212-&#8221-They are packaging HedgeStreet for a closing/fire-sale.&#8221-

RTT News.

U.S.-based sed HedgeStreet, which has operated the HedgeStreet Exchange, has liabilities of approximately $1 million and operating costs of approximately $325,000 per month. Currently, the company is not generating any revenue.


IG Group chief executive, Time Howkins, said the acquisition gives the company the necessary regulatory approvals, technology, personnel needed to operate an exchange for US retail clients to trade in binary options. The company said it plans to re-launch the exchange around the end of its current financial year, after making some modifications, mainly the range of contracts offered.

IG Group:

Corporate Profile

IG Group Holdings plc offers speculative investment products to a retail and professional client base, through a number of well-known brands.

The group&#8217-s principal businesses give clients the ability to trade on financial markets. Our longest established business is financial spread betting, where we are the world&#8217-s leading provider (based on turnover), servicing a retail client base, primarily in the UK. Our rapidly growing Contracts For Difference and foreign exchange business services retail clients and market professionals around the world from offices located in the UK, Australia, Singapore and Germany. The group also offers spread betting on sports, entertainment and political events and binary betting on both financial and sports markets. More than 90% of the group&#8217-s client transactions are executed electronically.

2006-7 headlines

Revenue up 36% at ?122.0 million
EBITDA up 34% at ?70.4 million
– Strong EBITDA margin of 57.7%
– Diluted earnings per share up 33% at 14.52p
– Final dividend 6.5p per share- total dividend 8.5p per share
– EBITDA margin improvement from 54.5% in H1 to 60.3% in H2
– Successful launch of TradeSense in UK and recent launch in Australia
– Launch of PureDeal dealing platform
– Current trading is strong

The group&#8217-s business has grown rapidly since the late 1990s, with revenues having grown at a compound annual rate of roughly 40% over the past nine years. We have also developed IG Group into a significant multinational operation.


Note: IG Group does not accept bets from customers based in the United States.

Author Profile&nbsp-Editor and Publisher of Midas Oracle .ORG .NET .COM &#8212- Chris Masse&#8217-s mugshot &#8212- Contact Chris Masse &#8212- Chris Masse&#8217-s LinkedIn profile &#8212- Chris Masse&#8217-s FaceBook profile &#8212- Chris Masse&#8217-s Google profile &#8212- Sophia-Antipolis, France, E.U. Read more from this author&#8230-

Read the previous blog posts by Chris. F. Masse:

  • Barack Obama is the 44th US president.
  • We already have prediction markets in future tax rates. It’s called the municipal bond yield curve.
  • O’Reilly – Money-Tech Conference
  • Google Profiles
  • Event Derivative Exchange HedgeStreet is baaaaaaaaack… from the grave.
  • Sports Derivative Forum

Meet John Nafeh, the HedgeStreet brain.

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Dr. John Nafeh – Director

John Nafeh is the Founder of HedgeStreet. He combined his expertise in decision analysis and risk management, his experience guiding Internet-related start-ups, and his vision of an Internet-based mass market for risk-hedging financial instruments [*] to create HedgeStreet. As Managing Director of Pareto Partners, a venture capital fund, Dr. Nafeh has demonstrated extensive expertise in start-up financing, strategic planning, marketing, and mergers and acquisitions. He was involved with Atari and Apple Computer during their start-up phases, founded PC and database software companies in the mid-1980s, and earlier held management positions with Ford Aerospace and General Electric. Along with a BS in electrical engineering, Dr. Nafeh holds an MS in management science and engineering and a PhD in decision and risk analysis from Stanford University.

John Nafeh

[*] a flawed vision?

Previous blog posts by Chris F. Masse:

  • The CFTC is going to close the comments in 15 days. We have 15 days left to convince the CFTC to accept FOR-PROFIT prediction exchanges, and counter the evil petition organized by the American Enterprise Institute (which has on its payroll Paul Wolfowitz, the bright masterminder of the Iraq war).
  • The CFTC is going to close the comments in 16 days. We have 16 days left to convince the CFTC to accept FOR-PROFIT prediction exchanges, and counter the evil petition organized by the American Enterprise Institute (which has on its payroll Paul Wolfowitz, the bright masterminder of the Iraq war).
  • Brand-new scientific report certifies that starting off the Large Hadron Collider is NOT going to destroy the Earth. Glad to hear that. It means that any bets entertained on the LHC issue will be able to be resolved and winnings to be collected in the end.
  • Small Business = GOOD — Big Business = BAD
  • The letter David Pennock will never send out —well, we hope.
  • Monitor the web traffic of,,,,,, etc. —thanks to Google Trends.
  • Here’s the way to promote innovation for entry-order and analysis software packages —separate the 2 functions.