With the growing popularity of presidential election prediction markets this year, not only can pollsters predict the outcome of the election, but ordinary investors can as well. Robinhood, the latest platform to make its foray into election betting, has raked in more than 100 million bets after introducing contracts last week, according to the company’s CEO.
“100 million contracts were traded in less than a week on the @robinhoodapp presidential election market,” Robinhood CEO and co-founder Vlad Tenev said on X on Sunday.
On the Robinhood app, users can watch in real time as bets are placed and either candidate’s probability of winning adjusts accordingly. Currently, former President Donald Trump is leading with 55% while Vice President Kamala Harris is polling at 46%.
The Robinhood betting site appears like this:
Robinhood, which allows users to trade a wide variety of stocks and crypto assets, introduced US election betting to its mobile app last week. Presidential election contracts are the first event contracts offered on its predictions market. In order to place bets, users must meet certain criteria, including being a US citizen and having been approved for a Robinhood Derivatives account.
Robinhood’s rollout came after a court in September sided with prediction market Kalshi, which had sued the CFTC to challenge a longstanding ban on election betting. The decision opened the door to these contracts in the United States, leading Kalshi to bet on the presidential race soon after. The new offering attracted $30 million in bets in its first three weeks.
The CTFC is appealing the decision which could halt betting, but not before the 2024 elections.
Kalshi and Robinhood aren’t the only prediction marketplaces offering election betting. Polymarket, a platform that offers cryptocurrency contracts, and PredictIt also offer popular contracts.
Although Polymarket cannot operate in the United States, its US election prediction market has accumulated nearly $3 billion in volume and had Trump polling around 58% on Monday. However, recent evidence suggests that a large portion of transactions on the platform are fake.
Prediction markets work like this: If Trump has a 55% chance of winning on Robinhood, contracts favoring Trump will cost $0.55 and users will be able to buy multiple contracts to increase their gains – or losses. If Trump wins you receive $1 for each contract and if he loses you receive $0 for each contract.
It is important to note the timing when purchasing election contracts on Robinhood. While the election is scheduled for November 5, the outcome of the contracts will not be determined until January 7 and users will not receive payment until January 8.
