Robinhood's prediction market business has officially outgrown its crypto division.
The brokerage reported $156 million in prediction market revenue for the second quarter, according to its earnings release Wednesday — compared with $100 million from crypto, a 38% year-over-year decline. It marks the first time prediction markets have generated more revenue than crypto since Robinhood launched event contracts.
Prediction market volume climbed to 13.6 billion event contracts in Q2, up 55% from 8.8 billion in the first quarter. The growth was driven in part by the World Cup, which Robinhood used as a launchpad for Rothera, its designated contract market joint venture with Susquehanna International Group. Rothera handled 2.1 billion contracts in its first month of operation and accounted for $17 million of prediction market revenue.
CEO Vlad Tenev said on the earnings call that Rothera had "rapidly become a top three DCM" after going live in late May, and that the company plans to direct more event contract flow through the platform as it scales. Robinhood also signaled intent to eventually offer perpetual futures in the US market.
The broader prediction market category — which lets users wager on sports, elections, and other real-world outcomes — has become Robinhood's fastest-growing revenue line. CFO Shiv Verma noted on the call that Robinhood has been narrowing spreads on less popular bets and directing more volume through Rothera to reduce costs. Kalshi remains the primary source of event contracts offered through Robinhood, with ForecastEx playing a smaller role.
Total Q2 revenue came in at a record $1.31 billion, beating analyst estimates. Robinhood Gold subscriptions grew 39% year-over-year to 4.8 million customers, and customer deposits reached a record $22 billion.
Robinhood shares (HOOD) closed at around $89 Wednesday, giving back earlier gains following a broader market selloff tied to the Federal Reserve's decision to hold interest rates steady.
