Key facts
- Robinhood CEO Vlad Tenev believes crypto prediction markets will soon surpass sports wagers.
- Robinhood's event-contract revenue reached $156 million in Q2 2026, a tenfold increase year-over-year.
- 4.7 billion contracts were traded in August, a 15-fold increase from the previous year.
- Robinhood built its event-contract hub on Kalshi and partnered with Susquehanna via Rothera.
- Lawmakers have introduced over a dozen bills targeting prediction markets, including the PREDICT Act.
Robinhood CEO Vlad Tenev told Jim Cramer on Mad Money that cryptocurrency contracts are already capturing a significant portion of Robinhood's prediction markets business, and he anticipates that sports betting will become a minority segment within a few years. Tenev views sports contracts as a gateway for attracting liquidity and users, with the industry's expansion extending far beyond this initial focus.
Robinhood's event-contract revenue experienced a more than tenfold increase year-over-year, reaching $156 million in the second quarter, making it the company's fastest-growing business line. In August, contracts traded 4.7 billion times, approximately 15 times the volume recorded in the same month the previous year. This growth occurred even as Robinhood's cryptocurrency trading revenue saw a decline over the same period.
The company's prediction market business operates on three main pillars: its initial launch on Kalshi, its own CFTC-licensed joint venture with Susquehanna called Rothera, and a recent minority investment in Crypto.com and its prediction-market spinoff OG.com. This multi-partner approach aims to clear and settle trades.
The legal standing of sports contracts is currently contested, with differing rulings from the Ninth and Third Circuits regarding Nevada's ability to regulate them. States argue that sports contracts are essentially a form of gambling. In contrast, crypto contracts do not face the same legal challenges. By shifting its business mix towards crypto, Robinhood aims to solidify the legal footing of its fastest-growing segment.
Tenev cited an example where users could trade on the Clarity Act, a bill that failed cloture. Prediction markets accurately anticipated the bill's failure, with Polymarket odds dropping from 35% to 11% before the Senate vote. The resurgence of excitement in the crypto market, driven by a lack of volatility during the bear market, is also contributing to increased market action and betting opportunities on various crypto-related events.