Robinhood Launches Betting Markets for 2024 US Election
Robinhood, the platform that made a name for itself by launching cryptocurrency investments during the pandemic, is once again making headlines.
Trump vs Harris poster. Robinhood begins offering US election betting markets.
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This time, the app has launched prediction markets for the 2024 US presidential election. Robinhood’s move draws inspiration from Kalshi, a similar prediction market platform that recently began offering election prediction markets. By following Kalshi’s lead, Robinhood believes it can introduce its prediction market without excessive risk, aiming to capitalize on the growing interest in election outcome speculation across the United States.
To place bets, customers must meet specific requirements for eligibility. Eligible participants must be US citizens with higher account statuses within the platform, approved for margin investing, and at least Level 2 or 3 options trading. This selective process allows Robinhood to maintain control over user access, addressing potential regulatory concerns around foreign influence and aiming to prevent conflicts with the CFTC and other regulatory bodies.
While Robinhood’s prediction markets offer a platform to speculate on political outcomes, the company is careful to avoid crossing into outright betting, which could lead to legal complications. Instead, the platform’s approach resembles “future contract” speculation, categorizing its market activities under the broader category of derivatives.
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This subtle distinction allows Robinhood to stay within regulatory lines, as political betting remains illegal in the US. To clarify the nature of the activity, Robinhood explained that an event contract is a form of financial derivative that allows speculation on the outcome of a specific event, usually with a ‘Yes’ or ‘No’ outcome.
With the 2024 election set for next Monday, interest in political predictions is high, and Robinhood’s prediction markets provide a new channel for Americans to engage in election speculation.
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