Robinhood expands sports event contracts as rivals flood industry

Reuters – Robinhood will allow customers to wager on the individual performances of professional football players as part of a new batch of sports-focused event contracts the online brokerage rolled out on Tuesday.

While users can already bet on the final result of a game, the latest contracts let them target more specific aspects such as whether a player scores a touchdown and how many yards they throw or run.

The move may help the Menlo Park, California-based company distinguish itself in a market that is drawing a wave of new entrants, but it comes at a time when some state regulators are seeking tougher oversight of the industry.

“There are a plethora of competitors. But with us being early to market, we’ve been able to fine-tune our product,” said Adam Hickerson, senior director of futures at Robinhood.

Critics argue that event contracts are similar to sports betting and could encourage more speculative trading by retail investors.

Industry players, however, say their contracts are regulated by and compliant with the Commodity Futures Trading Commission, the federal regulator that oversees derivatives.

Hickerson declined to comment on the legal challenges the industry is facing, but added that Robinhood will abide by all CFTC regulations.

The company also introduced “preset combos” that let customers tie multiple bets from one game into a single contract, which only pays out if every prediction is right.

Event contracts gained traction ahead of the U.S. presidential election last year. If a user’s prediction proves correct, such contracts typically pay out $1 each.

The monthly value of trades in prediction markets has climbed to over $13 billion, compared with less than $100 million in early 2024, according to a report by crypto investor Keyrock and blockchain data firm Dune.