Robinhood in Reversal on Kinship with Kalshi for Contract Events
Updated Article:
Title: Robinhood Halts Super Bowl Event Contract Trading: A Rough Start for Kalshi
May 2, 2025 | Daniel Craymer
It's been a tumultuous week for the US gaming industry, particularly when it comes to event contracts and the financial platform, Robinhood.
The firm has recently shut down its event contract product specifically designed to let traders bet on the outcome of Super Bowl LIX, just a day after its launch. The move was prompted by the US Commodity Futures Trading Commission's (CFTC) request.
Entering the Event Contract Game: Kalshi
Robinhood partnered with Kalshi, the forerunner in the rapidly growing prediction betting sector, for this venture. However, their collaboration has now hit a snag, with Robinhood's event contract product put on hold.
Event contracts have gained popularity in the US mainly due to Kalshi, offering an alternative style of betting where traders buy or sell contracts based on an outcome's likelihood. The contracts’ prices vary as they are bought and sold, and profits or losses can be made, much like trading real stocks.
Kalshi: Where Odds Meet Trading [Read Review]
So, How Does This Work?
Traditionally, event contracts have been used to hedge against financial market events. Kalshi has been authorized by the CFTC to offer such contracts. However, the CFTC has expressed doubts regarding Kalshi's Super Bowl product's legality under derivatives laws. Kalshi is now collaborating with the CFTC to address these concerns.
Last year, both Robinhood and Kalshi offered their event contracts on the 2024 presidential election outcome, but only Kalshi secured prior approval. The partnership with Robinhood appeared risky, which was later proven true with the CFTC's intervention.
The Rough Patch for Robinhood
In a recent blog post, Robinhood announced they were suspending the rollout of the Pro Football Championship market:
"We are suspending the rollout of the Pro Football Championship market. We have rolled this product out to roughly 1% of our customers, and for those who already placed trades, we plan on providing the option to close their positions or take them to resolution."
The Show Must Go On: Event Contracts at Kalshi
Even after the rollback, Kalshi continues to offer event contracts related to Super Bowl LIX, among other events, on its own platform. Users can also place bets on songs that Kendrick Lamar might perform at the half-time show and whether it will snow in New York City this month. With over $3 million in trades already facilitated on Super Bowl results, Kalshi stood to gain significant publicity.
The incident adds to the scrutiny faced by event contract trading platforms and the CFTC in regulating such practices.
As a sports betting enthusiast and editor, Daniel Craymer is always exploring new platforms, testing them with betting predictions, and discovering ways to perfect his sports betting strategy.
- Despite Robinhood's suspension of its Pro Football Championship market, Kalshi, a forerunner in the prediction betting sector, continues to leverage technology for offering event contracts related to Super Bowl LIX, songs Kendrick Lamar might perform, and whether it will snow in New York City this month.
- The US Commodity Futures Trading Commission (CFTC) has raised concerns about the legality of event contracts under derivatives laws, emphasizing the role of technology in shaping the future of event contract trading platforms.
