Robinhood’s prediction market business has now overtaken stock trading revenue, after previously surpassing cryptocurrency trading.
Bloomberg
Robinhood disclosed in its Q2 earnings report on July 29 that event contract revenue, including prediction market contracts, surged over tenfold year-on-year to $156 million. During the same period, stock trading revenue was $129 million, and cryptocurrency trading revenue was $100 million.
Prediction markets thus generated more revenue than Robinhood’s traditional stock and crypto trading businesses. At $776 million in total transaction-related revenue, prediction markets accounted for roughly 20%, becoming the second-largest business segment after options trading.
Will prediction markets continue to outperform Robinhood’s stock and crypto trading businesses till the end of 2026?
Robinhood initially launched contracts tied to the 2024 U.S. presidential election results before expanding into sports and economic indicators. Sports have become one of the largest trading categories, with the Q2 World Cup effect in the U.S., Canada, and Mexico further boosting activity. Event contracts traded on Robinhood increased tenfold year-on-year to 13.6 billion cases in Q2.
The sluggish cryptocurrency market also fueled prediction market growth. Robinhood’s Q2 crypto trading revenue fell 38% year-on-year. In contrast, prediction markets resolve profits or losses immediately once an event’s outcome is confirmed, eliminating the need for long-term waiting. Mizuho Securities highlighted the speed of results and rewards as key drivers, noting prediction markets could partially replace crypto trading demand.
Source: https://www.theinformation.com/articles/robinhood-now-makes-revenue-predictions-stock-trades
