(Bloomberg) — Shares of Robinhood Markets Inc. surged by over 12% following an announcement from Chief Executive Officer Vladimir Tenev regarding the company’s significant progress in prediction markets. These are platforms where users place bets on the outcomes of events such as elections and sporting events.
In a post shared on X on Monday, the CEO revealed that Robinhood customers have engaged in more than 4 billion transactions in event contracts, with a remarkable 2 billion occurring in just the third quarter.
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The rise of prediction markets gained notable attention during the 2024 US presidential election, with platforms like Kalshi and Polymarket facilitating substantial betting activity. Robinhood perceives this as a vital growth opportunity, as the growing trend blurs the lines between traditional financial markets and gambling.
Robinhood allows users to trade prediction-market contracts through a partnership with Kalshi, which operates under the oversight of the US Commodity Futures Trading Commission. The company also broadened its offerings to include contracts related to professional and college football starting in August.
This upward movement on Monday propelled Robinhoodâs stock to an all-time high, culminating in an impressive over 260% increase in share value this year alone. Furthermore, Robinhood has recently been included in the S&P 500 Index.
Aside from its focus on prediction markets, Robinhood continues to be primarily known for trading stocks, options, and cryptocurrencies.
—With contributions from Paige Smith.
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