Robinhood is making its debut in the prediction betting market on Monday, announcing that customers can start trading the eight-day-old 2024 presidential election.
Robinhood enters the crowded realm of political prediction markets after platform Kalshi defeated the Commodity Futures Trade Commission over election betting programs. The CFTC is appealing the judgment.
According to the website, users can trade a Donald Trump or Kamala Harris contract as early as Monday if they fulfill specific requirements, such as being a US citizen.
The election markets have generated a lot of controversy this year, with some individuals fearing that limited traffic could lead to price manipulation. The international website Polymarket disclosed that four accounts, all linked to a single French user, had spent millions of dollars to get the Trump contract. Nevertheless, an investigation found that the transaction was not involved in market manipulation, according to Polymarket.
According to a statement issued by Robinhood, “We think event contracts give people a tool to engage in real-time decision-making, unlocking a new asset class that democratizes access to events as they unfold.”
Earlier this month, Robinhood added paid index futures and options trading capabilities to its mobile app, departing from its usual commission-free trading approach.
The brokerage app now aims to become a full-service provider of financial services to compete with renowned brokerage firms that cater to institutional clientele.
It pledged earlier this year to boost margins and concentrate on “profitable growth” in 2024. Due to investor enthusiasm for new products and attention to earnings, the stock has increased by more than 100% so far this year.