Robinhood enters U.S. presidential prediction market

Robinhood Derivatives LLC announced a U.S. presidential election trading contract that allows some users to speculate on the Nov. 5 general election.

Robinhood noted that eligible US customers can trade two contracts in the “who will win the 2024 presidential election” market. According to the statement made by the California-based trading company, the contracts for Donald Trump and Kamala Harris were implemented on October 28.

We believe event contracts provide a tool for people to participate in real-time decision-making, unlocking a new asset class that democratizes access to events as they unfold.

Robinhood statement

Robinhood did not disclose any options for cryptocurrency deposits or user account funding, suggesting that transactions will be funded and settled in fiat.

This year, event contracts based on real-world events and crypto outcomes have reached billions of dollars in trading volume on platforms like Polymarket and Kalshi. However, presidential predictions and election betting markets are not a new phenomenon during US election periods. New York newspapers published daily odds in the late 19th and early 20th centuries.

Projects like Polygon-backed Polymarket have embraced America’s long betting history by incorporating blockchain technology. The on-chain platform founded by Shayne Coplan has over $2.3 billion in revenue in presidential event contracts. Polymarket is not available to US users and has recently reiterated this policy, but the protocol has dominated the prediction industry with a 99% market share.

Kalshi, like Robinhood, serves customers in the US as a regulated exchange. The Manhattan firm may soon include crypto deposits in addition to other digital asset-related markets. Otherwise, Kalshi also settles the bets in fiat.

Prediction markets continue to be an important trend in 2024 as global users turn to alternative data sources and social sentiment indicators. According to CoinGecko, the event results industry has increased by over 500% in the last 12 months, attracting the attention of new institutional participants such as Wintermute.