Robinhood Stock Rises Following Deal That Could Boost Its Prediction Market Push

Core Insights - Robinhood is acquiring a 90% stake in derivatives exchange LedgerX to launch its own prediction market platform, leading to an 8% increase in its stock price to $125 [1][6] - The company is responding to strong customer demand for prediction markets and aims to enhance its product offerings [2] - Bernstein analysts suggest that Robinhood's acquisition will allow it to launch its own event contracts, leveraging its existing market share [3][4] Company Developments - Robinhood's investment in LedgerX is part of a strategy to build a dedicated prediction market platform, enhancing its infrastructure for better customer experience [2][4] - The acquisition is expected to close in the first quarter of 2026, with Miami International Holdings retaining a 10% stake [4][6] - The partnership with Susquehanna International Group facilitated the acquisition, indicating a strategic alignment for entering the prediction markets [4][6] Market Context - Robinhood has already captured over 50% of Kalshi market volumes, indicating a strong position in the prediction market space [3] - The acquisition of LedgerX is seen as a move to increase revenue potential through innovative product offerings and increased market share [4] - MIAX, the operating name for LedgerX, has regulatory approval from the CFTC to list and clear futures and options, positioning it for growth in prediction markets [5][6]