Robinhood is stepping up its game by introducing investment contracts linked to the upcoming U.S. presidential election.
This move is aimed at attracting a new wave of users while putting pressure on existing platforms like Polymarket.
What’s new at Robinhood?
Robinhood is rolling out event-based derivatives that let investors bet on specific outcomes, such as who will win the presidential race.
This means you can speculate without actually buying any related assets. The company claims these contracts will allow for real-time decision-making and open up a new way for people to engage with events as they unfold.
The election-linked contracts will be available for trading until November 8, with prices fluctuating between $0.02 and $0.99 based on market sentiment.
As Election Day approaches, the contract for the winning candidate will increase in value, potentially paying out close to $1.
Winners will receive their payouts on January 8, 2025, after Congress certifies the results.
New kind of competition
Robinhood’s entry into this market adds more competition to an area that’s already seeing action from platforms like Polymarket, BET on Solana, and Trump Prediction Market Perpetuals on dYdX.
Polymarket has faced scrutiny over concerns about market manipulation, especially with large bets favoring Donald Trump.
But market analysts say it’s tough to prove manipulation when so many factors are at play.
Shayne Coplan, CEO of Polymarket defended the platform’s integrity against these allegations, insisting that they operate fairly and transparently. Despite this, some observers remain skeptical.
The numbers behind the buzz
Polymarket’s election outcome market has seen around $2.5 billion in trading volume so far.
Current odds suggest Trump has a 65% chance of winning, while his opponent Kamala Harris sits at 35%.
Robinhood’s new offering could change the game for how people engage with political events financially.
As more users look to speculate on election outcomes, it’ll be interesting to see how this all plays out in the coming weeks.
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