Robinhood Challenges State Regulators Over Sports Event Contracts

Robinhood Derivatives has filed lawsuits against Nevada and New Jersey regulators, seeking to block enforcement actions against its sports event contracts. The trading platform argues that state authorities are disregarding federal court rulings that favored Kalshi, a competitor offering similar CFTC-regulated contracts.

The legal clash highlights the tension between state gambling laws and federal oversight of prediction markets. Robinhood contends its contracts—allowing bets on sports and election outcomes—should receive the same protections granted to Kalshi. Federal courts previously barred states from taking action against Kalshi's comparable offerings.

This confrontation tests the boundaries of financial innovation in regulated markets. Robinhood's move underscores the growing intersection between trading platforms and event-based derivatives—a space where cryptocurrency exchanges have previously faced regulatory scrutiny.