Robinhood’s Kalshi competitor marks new threat for beleaguered prediction market

Core Insights - Robinhood's acquisition of LedgerX signals a strategic move to enhance its prediction market business, raising competitive concerns for Kalshi [1] - Kalshi's growth executive views the interest from major players like Robinhood as validation of their market [2] - Robinhood has generated approximately $300 million in annual recurring revenue from its prediction markets, with potential to significantly increase this revenue by launching its own platform [3] Company Developments - Robinhood, in partnership with Susquenha, plans to offer a proprietary prediction market service starting next year [1] - The company has previously collaborated with Kalshi to provide betting options on sports events, which has become one of its fastest-growing segments [2] - Despite Robinhood's new platform, it will continue to host Kalshi contracts, indicating a complex relationship between the two companies [4] Industry Trends - Prediction markets are gaining traction as a controversial yet popular business model, allowing users to bet on various events [5] - Kalshi and Polymarket are the primary competitors in this space, facilitating significant trading volumes, especially during major events like the US Presidential election [5] - Recent data shows Kalshi's notional volume exceeded $4.7 billion in the last 30 days, while Polymarket reported $3.7 billion, indicating a resurgence in market activity [6]