Robinhood on Tuesday suspended the rollout of its Super Bowl contract trading market, a day after it announced the offering as part of a partnership with Kalshi.
In a social media post, Robinhood explained that the Commodity Futures Trading Commission formally asked it to halt access to the sports wagering-like product, set for use in all 50 states regardless of sports betting legality.
“The Commodity Futures Trading Commission (CFTC) has formally requested that Robinhood Derivatives, LLC (RHD) ‘not permit customers to access’ sports event contracts,” Robinhood stated. “While we continue to work with the CFTC to understand their concerns, we are suspending the rollout of the Pro Football Championship market. We have rolled this product out to roughly 1% of our customers, and for those who already placed trades, we plan on providing the option to close their positions or take them to resolution.”
Robinhood taps Kalshi for Super Bowl trading
Through Kalshi, Robinhood aimed to allow users to buy contracts on the outcome of the big game — such as backing the Kansas City Chiefs or the Philadelphia Eagles to win the Super Bowl — and win or lose money based on whether their prediction is correct. The partnership was confirmed on Monday, less than a week before the biggest annual day of sports betting.
Robinhood expressed disappointment over the decision, citing its ongoing communication with the CFTC regarding its plans. The company said it remains committed to working with regulators to develop a more comprehensive event contracts platform in the future.
Exchanges aim to bypass gambling rules
Unlike traditional sportsbooks such as DraftKings or FanDuel, Kalshi operates as a regulated financial exchange, positioning event contracts as a trading asset rather than a gambling product.
This distinction allows it to operate in all 50 states, bypassing many of the regulatory constraints that sportsbooks face, including licensing, taxation, and state-by-state legality.
According to a news release from Robinhood, the brokerage views event contracts as “an opportunity to better serve our customers as their interests converge across the markets, news, sports, and entertainment.” It emphasized that these contracts “leverage the power and rigor of the financial market structure to facilitate greater liquidity, transparency, and price discovery.”
Sports events offered on Kalshi
Kalshi first launched sports-based trading options on Jan. 23. The new contracts allow users to trade on a variety of sports outcomes, including the following:
- Super Bowl champion
- NFL conference champions
- NBA champion
- NBA conference champions
- NHL champion
- NCAA men’s basketball champion
Kalshi battles regulatory scrutiny
Kalshi, which bills itself as a prediction market for trading event contracts, faced regulatory scrutiny over its election-based market in 2023, when the CFTC denied its request to list election contracts, citing concerns over potential manipulation and ethical implications.
A federal appeals court later ruled in favor of Kalshi, opening the door for trading platforms to accept over $400 million on political markets tied to the 2024 election, including $132 million on the presidency.
Kalshi has raised $156 million, is backed by major venture capital firms and recently appointed Donald Trump Jr. as a strategic adviser.
Robinhood’s entry discounted by Wall Street
Robinhood’s CEO first hinted at a move into sports event trading in December, following the company’s successful offering of event contracts tied to the presidential election. Monday’s announcement formalized Robinhood’s entry into the space through its partnership with Kalshi.
While some analysts see Robinhood’s entry into sports trading as an innovative way to bypass state-by-state legality, they also note that its immediate threat to established sportsbooks may be limited.
Unlike FanDuel and DraftKings, which have built profitability on high-margin bets such as same-game parlays, Kalshi’s offerings currently resemble traditional straight bets, where users wager on a single outcome like the winner of the Super Bowl.
Other exchanges face pushback over sports
The CFTC has taken an active role in reviewing similar contracts on other platforms. In December 2024, the agency opened a review into Crypto.com’s event contracts, questioning whether its offerings on championship winners and associated celebrations violated regulations that prohibit contracts tied to “gaming or unlawful activities.”
While Crypto.com rejected the CFTC’s request to pause its offerings, citing conflicting court rulings, the regulatory scrutiny highlights the evolving landscape of event contract trading and the attention it is garnering from regulators.