The line between prediction markets and gambling is the most contested question in financial regulation right now, with Former New Jersey governor Chris Christie warning prediction market platforms face lawsuits from all 50 states.
Bloomberg's Odd Lots hosts pushed Robinhood Markets Inc. (NASDAQ: HOOD) CEO Vlad Tenev on exactly that point.
Polymarket already hosted a Super Bowl coin toss contract trading at 50/50.
So what would actually stop Robinhood from skipping the Super Bowl entirely and livestreaming a roulette wheel for users to trade on?
"I'm not sure," Tenev said. "We don't offer any of those contracts."
The company traded over 12 billion event contracts in 2025 and more than 4 billion in January 2026 alone.
Tenev has called prediction markets the fastest-growing business in company history, with a revenue run rate above $300 million.
Leverage Is The Next Frontier
Tenev flagged leverage as the missing piece in prediction markets. He said it is not currently permissible but that the exchanges are working on regulatory clarity.
The comparison he drew was to options markets, where leverage is a core feature. Currently, prediction market contracts are binary instruments capped at a $1 payout. A trader buying a contract at $0.50 can only make $0.50.
Leverage would allow traders to put up a fraction of the notional value and control a larger position, the same mechanic that made options a multi-trillion-dollar asset class.
Crypto.com has already announced plans to offer margin-based prediction contracts through its OG platform, positioning itself as the first to do so.
CFTC Chairman Michael Selig has signaled imminent rulemaking on event contracts.
If leverage arrives, the competitive implications extend beyond prediction market platforms.
Flutter Entertainment (NYSE: FLUT) and DraftKings Inc. (NASDAQ: DKNG) have both seen steep drawdowns as prediction markets eat into sports betting market share.
Leveraged event contracts would make the threat significantly more acute by giving traders the kind of capital efficiency they currently get from options.
Tenev wants 100% of your financial life on Robinhood and prediction markets are the latest piece.
Tenev said smart order routing across multiple prediction market backends is coming, the same infrastructure that exists for equities.
Tenev described prediction markets showing up directly on individual stock detail pages. A trader looking at Tesla sees related event contracts right there. Earnings contracts are the big target.
Tenev called stock price an "imperfect proxy" for a specific EPS or revenue outcome and said traders with models would rather bet the number directly.
Those contracts are stuck in regulatory limbo as potential securities-based swaps under SEC jurisdiction, but CFTC-SEC harmonization is actively underway.
HOOD shares traded around $77 today, down roughly 50% from its 52-week high of $153.86.