Robinhood scales back prediction markets on insider trading concerns
Robinhood’s president says the platform has barred mention markets, citing the heightened risk of insider advantage.
UK.- The Retail trading platform Robinhood has reportedly scaled back the types of prediction markets available to its users amid concerns over insider trading and the misuse of event contracts. The move reflects growing anxieties in financial markets about prediction contracts, which allow traders to speculate on future events.
Jordan Sinclair, president of Robinhood UK, told the Financial Times on Sunday that the company is “very focused on market abuse and insider trading.” He said that Robinhood is limiting access to certain contracts. “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,” he said.
One controversial category is so-called mention markets, where wagers hinge on whether specific words or phrases appear in speeches or earnings calls. Robinhood has excluded such offerings, citing the heightened risk of insider advantage. Sinclair also said that the company prefers regulated venues like Kalshi and ForecastEx, while steering clear of higher-risk platforms such as Polymarket.
Growing challenges for prediction markets
Robinhood’s prediction markets are offered only in the United States, where the sector has been growing rapidly. The competition between the major players Kalshi and Polymarket become personal. Kalshi appeared to publicly criticise some of Polymarket’s offerings in billboard ads with phrases like “We don’t do death markets”.
Like Kalshi and Polymarket, Robinhood has also been in dispute with regulators. In September 2025, the company sued Massachusetts after the Massachusetts Securities Division attempted to block its event-based contracts on the grounds that they were allegedly unregistered securities.
Robinhood argued that the contracts are federally regulated derivatives listed on designated exchanges, and therefore fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC).
Last month, Kalshi and Polymarket introduced new surveillance tools against insider trading after senators Adam Schiff and John Curtis proposed legislation that would ban prediction markets from creating contracts related to sports under the “Prediction Markets are Gambling Act”.
Meanwhile, senator Richard Blumenthal has written to Polymarket founder and CEO Shayne Coplan, calling for answers by April 24 on what he sees as the platform’s failure to prevent insider trading on topics related to national security.
Many European countries, including France, Belgium, Germany and the Netherlands have banned access to platforms like Polymarket, treating them as either illegal gambling or unlicensed financial instruments. The British Gambling Commission has said that it believes such offerings would be considered as illegal gambling if they were launched in Britain without a licence.
However, some jurisdictions are experimenting with regulated pathways, including Gibraltar, whose gaming operators mainly target Britain. Gibraltar has already licensed Predictstreet.io under its existing gambling regulation, while lawmakers are exploring the possibility of creating a dedicated regulatory framework for predictions markets in Malta.
