Closer look at Robinhood's Sports Prediction Markets

​Robinhood, known for commission-free stock trading, ETFs, options and cryptocurrency, has recently ventured into the space of sports prediction markets. Robinhood has partnered with a company called Kalshi to capitalize on the concept of “sports event trading.” 

The partner, Kalshi, is an exchange that is regulated by the Commodity Futures Trading Commission (CFTC) after an initial legal challenge last year around election-focused prediction markets. Now, they’ve taken their offering a step further by offering event-based market options for sporting events. Robinhood now offers users the opportunity to buy and sell “event contracts” related to sports outcomes.

This move has sparked interest and controversy, especially considering Robinhood attempted and failed to offer sports-based event contracts for the Super Bowl back in February, upon receiving a request from the CFTC a day after their original announcement. With people in all 50 states having access to trading contracts connected to sports results through Robinhood, despite sports betting being legal in just 39 of those states, questions are being raised about the legality of these markets and potential implications.​

Does Robinhood now offer sports betting?

Robinhood's introduction of sports prediction markets allows users to trade contracts based on the outcomes of sporting events. “Buy” your prediction contracts, and profit if they are right.

Robinhood, which boasts tens of millions of users, maintains that these offerings are distinct from traditional sports betting. According to JB Mackenzie, VP & GM of Futures and International at Robinhood, "We believe in the power of prediction markets and think they play an important role at the intersection of news, economics, politics, sports, and culture." 

Unlike conventional sportsbooks where bettors wager against the house, Robinhood's model enables users to trade under the free market dynamics of trading. This peer-to-peer structure is facilitated through their partnership with Kalshi.

UPDATE Aug 21, 2025: Football Markets Unveiled

“Today, Robinhood Derivatives, LLC (RHD) announced the launch of pro and college football prediction markets directly within the Robinhood app. Available through the Prediction Markets Hub, customers can now trade on the outcomes of the most popular pro and college football games, including all regular-season pro matchups, and all college Power 4 schools and independents.”

Robinhood's Partnership with Kalshi

Kalshi is a CFTC-regulated exchange specializing in event contracts, allowing users to speculate on the outcomes of various events, including politics, pop culture and now sports. By collaborating with Kalshi, Robinhood integrates these event contracts into its platform, providing users with a novel way to engage with sports events like March Madness. This partnership aims to combine Robinhood's user-friendly interface and massive base of active users with Kalshi's regulated prediction market mechanics to offer a unique trading experience.

Where are Robinhood’s sports prediction markets available?

Robinhood's sports prediction markets are accessible nationwide through the app's "Prediction Markets" hub. This feature is integrated into the main page, providing users with immediate access upon opening the app. By leveraging Kalshi's platform, Robinhood currently offers these markets across the United States, irrespective of individual state regulations concerning sports betting.​ 

How can they offer sports prediction markets in states without legalized sports betting?

The legality of Robinhood's sports prediction markets in states without legalized sports betting hinges on the classification of these as event contracts. Since they are offered through a CFTC-regulated exchange and framed as trading instruments rather than traditional gambling, Robinhood and Kalshi maintain that they do not constitute sports betting. 

This distinction allows them to operate in jurisdictions where sports betting remains illegal. However, this approach has attracted regulatory scrutiny. One concern of certain state regulators is that this visually similar offering may be a way to offer sports gambling more widely, skirting the existing regulatory frameworks.

How are sports prediction markets different from sports betting?

While both involve speculating on sports outcomes, prediction markets operate under financial regulations governed by federal agencies like the CFTC, whereas sports betting is regulated by state gaming commissions.​ Robinhood also points to the market structure: prediction markets facilitate peer-to-peer trading of event contracts. In contrast, traditional sports betting involves placing wagers "against the house.​"

Prediction markets also maintain that their offerings fall under the umbrella of Purpose and Use cases – they are often utilized for hedging and information aggregation, providing insights into public sentiment on various events. Meanwhile, sports betting primarily serves as a form of entertainment under the umbrella of gambling.

However, the definition of “sports betting” has been closely scrutinized in recent years, in multiple states and court rooms - around the legality of Daily Fantasy Sports (DFS) products that resemble player prop parlays, sweepstakes-based betting that has a “no purchase necessary” dual-currency system, and now with these sports prediction markets. 

Addiction treatment for compulsive gambling, sports betting and financial trading

Engaging in activities that involve risking money for potential financial gain – in particular gambling, sports betting and day trading – can lead to compulsive, dangerous behaviors. All three share the allure of monetary rewards, risk-taking and the potential for significant losses. 

Birches Health offers specialized care online, from the comfort of home, with counselors who are certified in treating the complex aspects of these types of addiction. To get started with Birches or learn more you can: 

• Book an appointment 

• Call 833-483-3838

• Email help@bircheshealth.com