Robinhood curtails prediction market offerings over insider trading fears

(AsiaGameHub) –   Robinhood’s president stated that the platform has prohibited “mention markets,” attributing the decision to an elevated risk of insider advantage.

UK.- The retail trading platform Robinhood has reportedly reduced the variety of prediction markets accessible to its users, driven by worries about insider trading and the improper use of event contracts. This action highlights increasing apprehension within financial markets regarding prediction contracts, which enable traders to bet on future occurrences.

Jordan Sinclair, president of Robinhood UK, informed the Financial Times on Sunday that the company is “highly focused on market abuse and insider trading.” He indicated that Robinhood is restricting access to specific contracts, stating, “There are some we’ve chosen that aren’t right for our customers and that is, I think, the way you can kind of navigate that world.”

A contentious category involves what are known as mention markets, where bets depend on the appearance of particular words or phrases in speeches or earnings calls. Robinhood has removed these types of offerings, citing the increased potential for insider advantage. Sinclair further mentioned that the company favors regulated platforms such as Kalshi and ForecastEx, avoiding riskier ones like Polymarket.

Increasing difficulties for prediction markets

Robinhood’s prediction markets are exclusively available in the United States, a sector experiencing rapid expansion. The rivalry between key players Kalshi and Polymarket has intensified. Kalshi notably criticized some of Polymarket’s products through billboard advertisements featuring slogans such as “We don’t do death markets.”

Similar to Kalshi and Polymarket, Robinhood has also faced regulatory conflicts. In September 2025, the company filed a lawsuit against Massachusetts after the Massachusetts Securities Division sought to prohibit its event-based contracts, claiming they were unregistered securities.

Robinhood contended that these contracts are federally regulated derivatives traded on designated exchanges, thus falling under the purview of the Commodity Futures Trading Commission (CFTC).

Last month, Kalshi and Polymarket implemented enhanced surveillance measures to combat insider trading, following a legislative proposal by senators Adam Schiff and John Curtis. This proposed “Prediction Markets are Gambling Act” aims to prohibit prediction markets from offering contracts related to sports.

Concurrently, Senator Richard Blumenthal has sent a letter to Polymarket founder and CEO Shayne Coplan, demanding a response by April 24 regarding what he perceives as the platform’s inability to prevent insider trading on matters concerning national security.

Numerous European nations, including France, Belgium, Germany, and the Netherlands, have prohibited access to platforms such as Polymarket, classifying them as either unlawful gambling or unauthorized financial instruments. The British Gambling Commission has indicated that it would deem such offerings illegal gambling if introduced in Britain without a proper license.

Nevertheless, certain jurisdictions are exploring regulated approaches, including Gibraltar, whose gaming operators primarily serve the British market. Gibraltar has already granted a license to Predictstreet.io under its current gambling regulations, while legislators in Malta are considering the establishment of a specific regulatory framework for prediction markets.