Robinhood Launches Prediction Markets, Expanding into Event Betting
Robinhood, the popular trading app, is set to introduce prediction markets on its platform, allowing users to bet on future events. The move marks a significant expansion into the betting market sector, with initial offerings focusing on political predictions and sports events, including March Madness.
The new in-app betting hub will feature a variety of wagers, with early options including bets on US interest rates and the outcome of the NCAA basketball tournament. The competition is scheduled to officially begin on Tuesday, but pre-launch betting activity has already been substantial. A Polymarket bet on the March Madness winner has reportedly reached nearly $9 million in trading volume.
This strategic move aligns with Robinhood’s goal to cater to retail traders and broaden its role in betting markets. The prediction contracts will be available through Kalshi, a well-known predictions exchange. Following the announcement, Robinhood’s stock saw an increase of up to 2.75%.
CEO Vlad Tenev has long been a proponent of prediction markets. He envisions them as integral to both trading and information dissemination, anticipating that they will become a standard feature for various events.
The launch comes at a time when prediction markets have gained significant attention, particularly following the 2024 presidential election. The accurate prediction of Donald Trump’s second-term win by these markets boosted their credibility, with Polymarket and Kalshi emerging as key exchanges in the aftermath.
This isn’t Robinhood’s first foray into the prediction market sector. The company previously explored offering Super Bowl event contracts, but these were paused following a request from the US Commodity Futures Trading Commission.
As Robinhood ventures into this new territory, it remains to be seen how regulators and users will respond to the expanded betting options on the popular trading platform.
