Robinhood Prediction Markets: The 27M User Advantage

Robinhood (HOOD) has partnered with Susquehanna to offer prediction markets to its 27 million users, charging a flat $0.01 per contract compared to Kalshi’s variable fees. As we detail in our full review of the Prediction Markets presentation, Luke Lango identifies Robinhood as his main prediction market stock pick, and the reasoning is straightforward.

The User Base Advantage

Twenty-seven million users is the number that matters. Robinhood already has a massive user base of people who are comfortable trading stocks, options, and crypto on a mobile app. Adding prediction markets is a natural extension of the existing product, not a new category that requires user acquisition. Every one of those 27 million users is a potential prediction market participant.

For comparison, Kalshi and Polymarket are building their user bases from scratch. Robinhood is adding prediction markets to an existing, engaged audience. That is a fundamentally different growth proposition. If even a small percentage of Robinhood’s users participate in prediction markets, the volume could be substantial.

The Pricing Advantage

Robinhood charges a flat $0.01 per contract. Kalshi charges variable fees. For users who trade frequently, the flat-fee structure is significantly cheaper. This gives Robinhood a competitive advantage over dedicated prediction market platforms that charge more.

The pricing strategy is classic Robinhood. The company built its brand on zero-commission stock trading. Applying the same low-cost approach to prediction markets is a natural extension of its business model. If prediction markets grow from $64 billion to $1 trillion by 2030, as Lango projects, and Robinhood captures even a modest share through its 27-million-user base, the revenue impact could be material.

The Infrastructure Play

Lango’s thesis is that you do not need to place bets on prediction markets to profit from them. You invest in the companies that build the infrastructure. Robinhood is an infrastructure company in this context. It provides the trading platform, the user base, and the regulatory framework that makes prediction market participation accessible to mainstream investors.

This is the “backdoor access” approach. You are buying a stock, not placing a bet. Your investment thesis depends on the growth of the prediction market category, not on the outcome of any specific event. For more on this approach, see our article on prediction market stocks.

The Broader Prediction Market Boom

Trading volume on prediction market platforms is up 400 percent in recent quarters, according to Pew Research data. Lango cites estimates suggesting the market could grow from $64 billion today to $1 trillion by 2030. In 2024, Kalshi won a landmark court battle against the CFTC, establishing that prediction markets on political and economic events are legal in the United States. This removed the primary regulatory uncertainty.

Goldman Sachs has a team analyzing prediction markets and is reportedly building a prediction market trading desk. When Goldman Sachs enters a category, it signals institutional interest. For more on the market size, see our article on prediction market investing.

The Coinbase Connection

Lango reveals a second free ticker: Coinbase (COIN). Coinbase owns the rails that every Polymarket trade rides on. Polymarket runs on the Polygon network and uses USDC for settlement. Coinbase is the primary U.S. exchange for USDC and is rolling out prediction markets to its own user base. This means Coinbase benefits from prediction market growth regardless of which specific platform wins. For more, see our article on Polymarket stocks.

Robinhood as an Investment

Robinhood is a publicly traded company (NASDAQ: HOOD) that anyone can buy through a standard brokerage account. The investment thesis is that prediction markets represent a new revenue stream for an existing platform with 27 million users. The flat $0.01 per contract pricing gives it a competitive advantage over dedicated prediction market platforms.

The risks are real. Robinhood is exposed to broader market conditions, fintech competition, and crypto regulation. The prediction market opportunity is one component of its business, not the whole story. And the $1 trillion market size projection is an estimate, not a guarantee. But for investors interested in the prediction market thesis, Robinhood is the most direct way to gain exposure through an established, publicly traded company.

For more on Lango’s presentation, see our article on prediction markets and Robinhood. For the broader market context, see our article on prediction market stocks.

This is not financial advice. Always do your own research before investing.

The Market Structure

Robinhood’s prediction market offering is structured as a partnership with Susquehanna, one of the largest market-making firms in the world. Robinhood provides the platform and the 27-million-user base. Susquehanna provides the market-making infrastructure, which includes pricing, liquidity, and risk management. This is a different model from Kalshi, which operates its own exchange, and from Polymarket, which operates on a blockchain.

The partnership model is significant because it means Robinhood does not need to build the prediction market infrastructure from scratch. It leverages Susquehanna’s decades of market-making experience while providing the user interface and distribution. This is a classic platform strategy: own the customer relationship, partner for the back-end infrastructure.

The Growth Thesis

Lango projects the prediction market category growing from $64 billion to $1 trillion by 2030. If that projection is even partially correct, the platforms that facilitate prediction market trading will see significant revenue growth. Robinhood’s flat $0.01 per contract pricing is designed to capture volume, and volume is what drives revenue in a low-fee model.

The 27-million-user base is the key competitive advantage. No other prediction market platform has access to that many existing users. Kalshi and Polymarket need to acquire users through marketing. Robinhood just needs to activate existing users. The customer acquisition cost is effectively zero, which means the revenue from prediction market trading flows more directly to the bottom line.

For more on the investment thesis, see our full Prediction Markets review. For more on Robinhood’s positioning, see our Robinhood LLC account article.

Considerations

The thesis depends on prediction markets growing as projected and on Robinhood maintaining its competitive position. The regulatory environment, while clarified by the 2024 Kalshi court ruling, could still shift. Competition from Coinbase, Kalshi, and Polymarket could compress fees. But Robinhood’s user base advantage and partnership with Susquehanna give it a structural edge that is difficult to replicate.

If you want to explore Lango’s full thesis, you can access the Prediction Markets presentation through InvestorPlace.