Robinhood on September 8 announced a strategic partnership with Crypto.com and OG.com to expand its prediction markets business. The agreement adds trading venues for Robinhood’s event contracts and gives the company stakes in both entities as prediction markets face legal challenges from several U.S. states.

Robinhood has begun routing some American football-related event contracts through Crypto.com’s exchange and clearing infrastructure, which are regulated by the U.S. Commodity Futures Trading Commission. Some futures will also be routed through OG.com.

The company will continue working with other venues, including Kalshi, ForecastEX and Rothera. Robinhood representatives said using multiple trading venues would make the market more diversified and resilient.

Under the partnership, Robinhood will receive stakes in Crypto.com and OG.com after OG.com is spun off into an independent trading platform. The stakes’ value will be set with reference to Citadel Securities’ recent investment in Crypto.com Group, which implied a $20 billion valuation.

Robinhood also plans to offer more sports-related contracts, including contracts covering match results, individual player statistics and combination outcomes. The company plans to launch a dedicated section focused on the U.S. midterm elections.

Prediction markets revenue surpasses crypto

Robinhood’s prediction markets business recorded its highest revenue and trading activity during the first eight months of 2026. Users entered into 13.6 billion event contracts in the second quarter, including more than 5 billion during the World Cup.

That volume generated about $156 million in revenue for Robinhood, up 50% from the previous quarter. Prediction markets surpassed the company’s crypto business by revenue for the first time in the second quarter. Robinhood generated $100 million in revenue from digital asset operations during the period.

U.S. states challenge event contracts

The expansion comes amid disputes over the legal status of event contracts in the United States. Authorities in several states contend that sports prediction markets effectively constitute betting and should therefore be regulated under state gambling laws.

In April 2026, the Wisconsin Department of Justice filed three lawsuits against Kalshi, Polymarket, Robinhood, Crypto.com and Coinbase. The agency asked the court to find that the companies’ sports contracts violate state law and to prohibit them from continuing to offer the products.

Washington state Attorney General Nicholas Brown sued Kalshi a month earlier. State authorities accused the platform of violating local gambling laws and said its sports-contract mechanism effectively mirrors the operation of sportsbook services.

In Nevada, the Gaming Control Board filed a court action against Coinbase seeking to prevent the exchange from offering sports event contracts without the appropriate license. The regulator considers the contracts a form of betting.

On September 8, the U.S. Court of Appeals for the Tenth Circuit denied Kalshi an emergency injunction intended to shield the platform from the application of Utah law while its appeal is pending. Legal analyst Daniel Wallach said state authorities could now enforce local gambling rules against the company. By his count, the ruling was the 12th consecutive federal court decision favoring states in disputes with prediction market operators.

The federal government has taken a different position. In February, the CFTC asserted “exclusive jurisdiction” over commodity derivatives, including event contracts. The regulator also submitted a legal position in its dispute with Nevada supporting the federal regulatory framework for those instruments.

The competing approaches have created a conflict between the CFTC’s federal position and state authorities’ efforts to apply local gambling laws. According to Bernstein, litigation involving the sector was underway in 14 U.S. states by spring 2026, while lawmakers had introduced four measures to regulate it.

Source: Incrypted