Robinhood launched a prediction markets hub on March 17 that would be initially available through the Commodity Futures Trading Commission-regulated prediction platform Kalshi and would feature event contracts on college basketball tournaments and the May federal funds rate. A Robinhood spokesperson told Cointelegraph that the event contracts “are regulated by the CFTC and offered through CFTC-registered entities.”“Prediction markets have become increasingly relevant for retail and institutional investors alike, and we’re proud to be one of the first platforms to offer these products to retail customers in a safe and regulated manner,” the spokesperson said.
Massachusetts’ securities regulator has reportedly launched a probe over Robinhood’s prediction markets offering that has allowed users to bet on the outcomes for a slew of events, including basketball tournaments. Reuters reported on March 24 that Massachusetts Secretary Bill Galvin said his office subpoenaed Robinhood last week to get information on its marketing materials and the number of Massachusetts-based users that traded sports events contracts on college basketball tournaments.
Last month, Robinhood scrapped event contracts allowing for bets on the Super Bowl a day after launching the products after the CFTC asked it to. The Massachusetts probe also requested Robinhood hand over internal communications about the decision to roll out the recent college basketball events contracts after the CFTC's request to stop the Super Bowl contracts.
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Author / Journalist: Cointelegraph by Jesse Coghlan
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