Closer look at Robinhood’s Sports Prediction Markets

This page will be updated accordingly as new developments arise, such as individual states taking action or operators entering and exiting various markets. Looking ahead, all the panellists took 1win india a bullish view on the new asset class. Deese from ForecastEx anticipates a lot more adoption from institutional investors. Kalshi’s Lopes Lara see the markets becoming more mainstream, in the same camp as crypto and stocks.

Phantom vs. Moonshot: Where to trade memecoins?

• Traditional sportsbook operators have shown patience around prediction markets, saying they want the format to gain clearer legal backing before diving in.
• Some platforms have been forced to stop operating after being classified as offering unlicensed gambling.
• The platform doesn’t offer the depth of markets, live betting options, or promotional features that are standard in established sportsbooks.
• In response, Kalshi has taken three state regulators to court, arguing that the company does not fall under their jurisdiction because it is a financial exchange, not a sportsbook.

Your proposal becomes a resting order, for which you can set an expiration date. In letters to the CFTC, the NBA, NFL and MLB — who all have official partnerships with sportsbooks — voiced concerns about protecting the integrity of games in this new market. Right now, Kalshi and Robinhood are the only options for sports contracts in the US. Choosing “No” would be the riskier pick, but it also offers a bigger potential payout if the team does make it. If the Eagles make it to the Big Game, each share pays out $1, giving you a total return of $13.70, which is $3.70 in profit. While the platforms are rising in popularity and revenue this might not be a problem, but it is highly possible more traditional investment may be needed to keep the market sustainable in the future.

Stephen Crystal is the founder of SCCG Management and a longtime gaming industry executive and consultant. Encouragingly, the CFTC is considering all sides – including constitutional law, consumer safety, and market impact. A coordinated solution may emerge that honors both innovation and integrity. Save now on essential digital access to quality FT journalism on any device. Prediction markets first saw a rise popularity in the mid 2010s, before falling off slightly.

Top Prediction Markets in 2025 – Reviewed by Experts and Users

Robinhood has been available since 2014, and it has a stellar history with financial trading. As of 2025, over 25 million funded account holders used the site. As of April 1, Robinhood is legal in all 50 US states, giving it a slight edge over Kalshi. The platform is certified by the CFTC and is a member of the Securities Investor Protection Corporation (SPIC) and Financial Industry Regulatory Authority (FINRA). Kalshi has won critical but potentially fleeting legal victories in some of these cases.

In the space of only a few weeks, millions of people used these contracts to bet on whether Donald Trump or Kamala Harris would win the US presidential election. That success demonstrated that these contracts could become a new asset class for both retail and institutional investors. This regulatory foresight and adaptability have positioned Kalshi as a resilient player in the prediction market sector, distinguishing it from earlier ventures that struggled to achieve long-term viability. As for the markets themselves, sportsbooks offer a greater variety of options.

Signing up for a prediction market site follows similar steps to signing up for a sportsbook. You’ll need to provide personal information, such as your name, birth date, address, and in many cases, your social security number. Crypto.com allows users to make purchases with 400+ cryptocurrencies and fiat currency options, making it one of the most accessible apps in the industry.

How Prediction Markets Work: Betting vs. Trading

Prediction markets are financial exchanges where the prices change based on demand, much like in a stock market. The predictions you make are essentially taking a position against other traders, not taking action from the house. Prediction markets also benefit from growing popularity of financial trading among individuals. Customers find them familiar, as they resemble market trading and add timely buying and selling of bets into the sports betting equation. Additional states have launched investigations into sports prediction markets and asked the CFTC to intervene.

Kalshi reported a wild 300% increase in trading volume in early 2025, and about 40% of that was sports. Analysts are buzzing about the potential for prediction markets to become a trillion-dollar asset class by 2030, potentially rivaling the $16 billion annual handle of traditional sports betting. Event contracts are explicitly not allowed to involve “gaming,” which is regulated by states, though the limits of what gaming entails remain somewhat undefined.

Susquehanna is a primary market maker that also owns a sports betting company. These event contracts offer a direct method to trade on specific events without searching for appropriate proxies. The Ohio Casino Control Commission has also now sent out cease-and-desist notices. The OCCC action has targeted three operators — Kalshi, Robinhood and Crypto.com — stating that they are not operating legally in the state for the sports event markets. The advent of smart contract blockchains changed the landscape of prediction markets once again. This guide covers how prediction markets came to be, how they work in crypto, what’s holding them back, and who’s leading the charge—think Polymarket, Kalshi, BET by Drift, Triad, and Hedgehog.

If states win, these contracts may be banned, or prediction markets forced to apply for gambling licenses. From their perspective, purchasing a contract based on which team a person thinks will win a sporting event is no different than placing a bet through a traditional sportsbook. The prediction model is closer to a stock market or trading exchange where prices fluctuate on a daily basis. After buying your contract, you can either keep it running until it settles or sell it back – the equivalent of cashing out at a sportsbook. Just like a traditional sports bet, once the game has concluded, your sports prediction will settle, and you will be paid out. For each contract you buy, you will be paid $1 minus any trader’s fees.

Traditional sportsbook operators have shown patience around prediction markets, saying they want the format to gain clearer legal backing before diving in. There are signs they are moving closer to entering direct competition with prediction market apps. Futures trading platforms like Kalshi turn to institutional market makers to fill contracts when there isn’t someone waiting on the other side to complete a deal. These are often huge funds like Susquehanna, which price contracts slightly above their true value, tipping the scale away from retail traders who take the deals anyway so they can immediately enter a market. If the public determines there is a 40% chance of an event occurring, corresponding “yes” event contracts are priced at about $0.40 before trading fees.