With the U.S. presidential race approaching a crescendo, Robinhood became the latest firm to offer event contracts for the White House’s soon-to-be-chosen winner.
The investing app announced Monday that Robinhood Derivatives will offer two contracts letting traders speculate on whether former President Donald Trump or current Vice President Kamala Harris will take the election. The move comes as Trump and Harris make their final pitches—with seven days left in the 2024 race.
Blockchain-based prediction platform’s like Polymarket have thrust election betting into the limelight, and Robinhood’s offering shares similarities, while not relying on crypto tech. Traders can purchase contracts for a candidate that adjust in price, eventually paying out $1 per purchased contract if said candidate wins.
Unlike Polymarket’s platform, however, Robinhood’s offering is purely U.S.-focused. Robinhood said that the contracts are offered through ForecastEx, a futures commission merchant regulated under the Commodities Futures Trading Commission (CFTC).
Polymarket has been off-limits for users in the U.S. since 2022, when the startup agreed to a cease and desist from the CFTC alongside settling a $1.4 million fine. Even though Polymarket reportedly has systems in place for vetting users, Robinhood articulated its restrictions clearly in its announcement.
Anyone attached to the U.S. presidential election or politics is forbidden from participating in the market, such as White House staff and presidential campaign members. Additionally, each bettor must be approved by Robinhood Derivatives in order to participate in the market.
Robinhood’s embrace of event contracts for 2024 represents how political betting has increasingly gone mainstream. Rolled out in the 2024 race’s home stretch, it may also illustrate how shifts in the regulatory landscape are influencing how firms approach the space.
The prediction market platform Kalshi notched a major legal victory over the CFTC last month. While the CFTC has tried to block Kalshi’s prediction markets for two years, a federal judge ruled that the platform could move forward with plans to launch U.S. election markets, starting with congressional bets.
The ruling was quickly appealed, but Kalshi launched a U.S. election betting pool not long after. And earlier this month, the multinational brokerage firm Interactive Brokers jumped into the election betting scene, unveiling its own set of election-based contracts.
While Trump or Harris could emerge victorious on Election Day as results for key battleground states trickle in, the market offered by Robinhood Derivatives will resolve two months later—after results are certified by Congress. The expected date is Jan. 7, based on Congressional Record filings, per the terms of ForcastEx’s U.S. presidential market contract.
Robinhood did not immediately respond to a request for comment from Decrypt.
Edited by Andrew Hayward
