Since launching prediction markets on its platform last year with the presidential election markets, Robinhood has doubled its volume of contracts each quarter, Tenev said.
The company’s number of total event contracts traded reached 2.3 billion in the third quarter, and it totaled 2.5 billion in October alone, according to a Wednesday earnings release.
“I think it’s really exciting to see where this can go,” Tenev said during the call. “I mean, we love being early to this new asset class, and some people are saying this could be one of the largest asset classes because you can price risk in pretty much anything.”
PYMNTS reported in October that there is a prediction market boom driven in part by the market architecture that allows for far broader products and by the entry of major platforms.
Since launching with the presidential election markets, Robinhood has expanded its prediction market categories to include sports, economics, politics and culture, Tenev said during Wednesday’s earnings call.
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Prediction markets have become one of Robinhood’s latest business lines generating $100 million or more in annualized revenues, according to a presentation released Wednesday.
It is one of several examples of how Robinhood is growing and diversifying its business, the presentation said. Year to date, the company added two business lines generating that level of annualized revenue, prediction markets and Bitstamp, a cryptocurrency exchange.
In 2024, Robinhood added three such business lines: fully paid securities lending, Gold subscriptions and instant withdrawals, per the presentation.
“Q3 was another quarter of relentless product velocity,” Tenev said during the call. “We were excited to see that. It was really across our three focus area, which, as a reminder, are number one in active traders, number one in wallet share for the next generation, and number one global financial ecosystem.”
Robinhood now has 11 businesses that surpassed $100 million in annualized revenue, “underscoring the growing diversification and strength of our business,” Tenev said.
“Prediction markets reached that milestone in less than one year,” Tenev said. “It’s our fastest in history, and it’s already tracking towards a $300 million run rate based on October volumes.”
