Prediction Markets Are Booming at Robinhood. What It Means for HOOD Investors

By AltIndex Research · 11 min read · September 1, 2:55 pm

Robinhood has spent years trying to become more than the app people open when they want to trade stocks or crypto. Prediction markets may be one of the clearest signs yet that the strategy is working.

The company launched its dedicated Prediction Markets Hub in March 2025 with a relatively narrow lineup of contracts tied to the Federal Reserve and college basketball. Less than 18 months later, the business is handling billions of contracts and generating meaningful revenue for Robinhood.

In the second quarter of 2026, Robinhood generated $156 million in event-contract revenue. Customers traded 13.6 billion event contracts during the quarter, more than 10 times the volume from a year earlier.

That is becoming large enough to change how investors should think about Robinhood. Prediction markets are not replacing stocks, options or crypto, but they are giving the company another high-engagement business that can grow without depending entirely on cryptocurrency trading or a surge in equity-market speculation.

Prediction Markets Went From Experiment to Real Revenue

Robinhood officially launched its Prediction Markets Hub on March 17, 2025. At launch, customers could trade contracts around the Federal Reserve's interest-rate decision and the men's and women's college basketball tournaments.

The contracts were initially offered through Kalshi, a CFTC-regulated exchange. Customer adoption quickly moved beyond that limited launch.

By August 2025, Robinhood said more than 2 billion prediction-market contracts had already been traded as it expanded into professional and college football. By the end of 2025, Robinhood reported more than 12 billion event contracts traded during the year. The growth comes as prediction markets are booming more broadly, with platforms expanding beyond elections and sports into company-specific contracts tied to earnings, layoffs, acquisitions and other outcomes.

The revenue contribution is now becoming just as important as the volume.

Robinhood reported $156 million in event-contract revenue in Q2, up more than tenfold year over year. For comparison, cryptocurrency transaction revenue was $100 million during the quarter, while equities generated $129 million and options generated $342 million.

Robinhood Was Hiring Specifically for Prediction Markets

Robinhood has not built the business simply by adding another trading screen to its app.

Historical job-posting data shows Robinhood recruiting specifically for prediction-market roles while the product was expanding.

The postings span engineering, product development and financial strategy. They do not tell us exactly how large Robinhood's prediction-markets organization became, nor do they prove that those hires caused the subsequent growth.

But they provide a useful view beneath the surface. As prediction-market volumes were scaling, Robinhood was building dedicated internal capabilities around the product.

Robinhood Has Been Expanding More Broadly Too

The prediction-market hiring happened during a much larger period of expansion at Robinhood.

Robinhood's headcount (according to LinkedIn data) increased from 3,377 in September 2024 to 4,976 today. That is an increase of roughly 47% in two years.

Employee confidence improved alongside that growth. Robinhood's positive employee business outlook rose from 46% to 63% over the same period and reached as high as 68% earlier this year.

That is an encouraging combination. Robinhood has significantly expanded its workforce while employee sentiment has improved rather than deteriorated.

Aggregate job openings, however, do not show another broad hiring surge. Robinhood had roughly 215 tracked openings at the beginning of September, versus 234 two years ago. That makes the prediction-specific postings more interesting: Robinhood was not simply increasing hiring everywhere, but was allocating roles directly toward the new business.

Customer Interest Has Been Moving Higher

The consumer-side data also points to a larger Robinhood footprint.

Robinhood web traffic, according to our estimates, increased from approximately 29.7 million monthly visits in September 2024 to 37.8 million in July 2026, an increase of roughly 27%.

Traffic reached approximately 41.1 million visits in June before easing the following month.

Robinhood's social audience has expanded even more noticeably. Its Instagram following increased from about 238,000 in September 2024 to nearly 356,000 today, a gain of roughly 49%.

The increase has been persistent rather than the result of one short-lived spike, giving Robinhood a substantially larger direct audience as it introduces customers to products such as prediction markets.

Robinhood Is Moving Deeper Into the Prediction-Market Business

One of the more important developments for investors is happening behind the consumer-facing product.

Robinhood initially relied on third-party exchanges such as Kalshi to provide prediction-market contracts. In November 2025, however, Robinhood announced a joint venture with Susquehanna International Group to operate a CFTC-licensed futures and derivatives exchange and clearinghouse.

The venture became Rothera and completed its acquisition of MIAXdx in January.

Rothera began handling selected Robinhood contracts in June, including World Cup and professional baseball markets, with Robinhood saying it planned to route additional events through the exchange over time.

The business already became material during its first quarter of operation. Robinhood disclosed that 2.1 billion Q2 event contracts were traded through Rothera, generating $17 million of Rothera revenue. Robinhood later said more than 3.5 billion contracts had traded through the exchange since launch.

That vertical integration matters. Instead of simply acting as the interface through which customers access another exchange, Robinhood is increasingly gaining control over the infrastructure and economics behind the contracts its customers trade.

The Biggest Question Is Regulation

The growth story is not without risk.

Prediction markets occupy a complicated regulatory position, particularly when contracts cover sporting events. Federally regulated derivatives exchanges have argued that event contracts fall under Commodity Futures Trading Commission jurisdiction, while several states have challenged sports-related prediction products under state gaming laws.

That means the same trend making prediction markets more attractive to investors also makes regulatory developments more important. A small experimental feature can absorb regulatory uncertainty relatively easily. A business producing more than $150 million of quarterly revenue cannot.

What It Means for HOOD Investors

Robinhood's broader transformation has already been substantial. The company has expanded into retirement accounts, credit cards, banking products, futures, advisory services and international markets while continuing to grow its core brokerage business. Prediction markets add another meaningful revenue stream to that expansion.

The important part of the story is not simply that customers traded 13.6 billion event contracts in Q2. Robinhood is increasingly treating prediction markets as a business in its own right: generating $156 million of quarterly revenue, hiring dedicated product and strategy staff, and investing in its own exchange infrastructure.

Our alternative data does not prove that prediction markets drove Robinhood's broader growth. But it does show what was happening underneath the company while the new business was taking shape: headcount increased roughly 47%, employee confidence improved, estimated web traffic rose about 27%, Instagram followers increased nearly 50%, and Robinhood recruited specifically for prediction-market roles.

Meanwhile, Robinhood's current AI Score sits at 51, a relatively neutral reading despite strong revenue growth and the emergence of prediction markets as a meaningful new revenue stream.

For investors, the key question from here is whether prediction markets can continue growing quickly enough to become a durable source of diversified revenue, and whether Robinhood's move deeper into the market through Rothera improves the economics without adding too much regulatory risk.

Either way, investors who still think of Robinhood primarily as a stock-and-crypto trading app increasingly are not seeing the whole business.

Disclosure: This article is for informational purposes only and does not constitute investment advice. AltIndex aggregates publicly available alternative data signals. Past signal performance does not guarantee future results. Always do your own due diligence before making investment decisions.