Robinhood to Leave Out Some Prediction-Market Contracts Over Manipulation and Insider-Trading Risks

Robinhood is scaling up its push into prediction markets but plans to withhold certain contracts that it believes could heighten the risk of market manipulation and insider trading, according to Odaily Planet Daily. Jordan Sinclair, president of Robinhood UK, said the company is focused on preventing market abuse and will not make every prediction market or event contract available. Instead, it intends to list only products it views as more appropriate for its customer base. Regulators have taken a closer look at so-called "precise betting" cases in recent months. One example cited involved unusually large wagers placed on Polymarket ahead of U.S. actions against Iran. Israeli authorities have also prosecuted two individuals accused of using confidential information to place bets. Robinhood is also excluding "mention markets"—contracts that allow users to bet on specific words that may appear in a speech—because of their vulnerability to manipulation. For now, Robinhood is offering prediction-market access mainly through partnerships with Kalshi and ForecastEx, aiming to rely on regulated venues to limit information misuse and reduce cross-border compliance risk. Polymarket, by contrast, is not subject to the same level of regulation and allows trading via crypto wallets with looser identity checks. Robinhood has previously signaled that prediction markets could become a key growth driver. CEO Vlad Tenev has said the business could rank among the company's fastest-growing segments by 2025 and could eventually generate annual trading volumes in the trillions of dollars. (Financial Times, UK)