Robinhood (HOOD) Is Betting Big on Prediction Markets — Just Not All of Them

TLDR

• Robinhood dropped 1.33% on Friday, closing at $69.19
• The company is expanding prediction markets but cutting out high-risk contract types
• “Mention Markets” — bets on words used in speeches — have been removed due to manipulation concerns
• Robinhood partners with regulated platforms Kalshi and ForecastEx rather than unregulated rivals like Polymarket
• CEO Vlad Tenev called prediction markets the firm’s “fastest-growing business ever” in 2025, with 12 billion contracts traded

Robinhood is growing its prediction markets business, but it’s drawing a clear line on what it will and won’t offer users.

Robinhood Markets, Inc., HOOD

The company has pulled certain event contracts from its platform, specifically “Mention Markets” — contracts that let users bet on specific words appearing in speeches or earnings calls. Robinhood UK President Jordan Sinclair said these were cut for concerns around market abuse and insider trading.

The decision comes as prediction markets face growing scrutiny from regulators. Several high-profile cases have raised red flags across the industry.

Large, well-timed bets appeared ahead of a U.S. military strike on Iran. Israeli authorities charged two individuals with using classified military information to place wagers. Bets also surged ahead of a Nobel Peace Prize announcement, triggering a leak investigation.

Even outside politics, a former editor linked to a major YouTube channel was fined $20,000 for trading on advance knowledge of upcoming content.

These cases show how prediction markets can be exploited when outcomes hinge on private information.

Regulated Partners Over Wild West Rivals

Robinhood has chosen to work with Kalshi and ForecastEx — both regulated U.S. platforms that require identity verification and operate under U.S. rules. That puts them in a different category from Polymarket, which lets users trade through crypto wallets with minimal identity checks.

For a publicly listed company, that distinction carries real weight. Limiting exposure to unregulated activity reduces legal and reputational risk.

Robinhood sees the broader prediction market space as a major revenue opportunity. The company is targeting roughly $300 million in annual revenue from the segment.

CEO Vlad Tenev described prediction markets as the firm’s “fastest-growing business ever” in 2025. Over 12 billion contracts were traded through the platform that year.

Tenev has also floated the idea that the market could evolve into a “supercycle,” with trillions in annual volume over time — though he offered no timeline on that projection.

HOOD Stock on Friday

Robinhood’s stock dipped 1.33% on Friday, closing at $69.19.

Wall Street remains bullish on the name. Based on 17 analyst ratings, HOOD carries a Strong Buy consensus. The average price target sits at $106.20, which would represent a 53.49% gain from Friday’s close.

Robinhood’s move to cut Mention Markets follows earlier cases where editors were penalized for insider trading tied to similar contract types.

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