As a seasoned researcher with a keen interest in the intersection of finance, technology, and politics, I find the emergence of event contracts like Robinhood’s presidential election trading contract intriguing. Having delved into the world of prediction markets and their evolution over time, it’s fascinating to see how platforms are leveraging blockchain technology to democratize access to real-time decision-making.
Robinhood Derivatives LLC unveiled an American presidential election derivative contract, enabling certain users to make predictions or wagers regarding the outcome of the November 5th general election.
According to Robinhood’s announcement, U.S. residents who meet certain eligibility criteria can now engage in predicting the winner of the 2024 presidential election by trading two available contracts: one for Donald Trump and another for Kamala Harris. The trading options for both candidates became active on October 28, as confirmed by Robinhood’s California headquarters.
We believe event contracts give people a tool to engage in real-time decision-making, unlocking a new asset class that democratizes access to events as they unfold.
Robinhood statement
In simpler terms, Robinhood didn’t provide any options for depositing cryptocurrency or funding user accounts. This implies that all trades will be funded and settled using traditional currency (fiat).
In the current year, contracts for events tied to real-world happenings and cryptocurrency results have amassed billions in trading volume on platforms such as Polymarket and Kalshi. Yet, it’s important to note that forecasting presidential elections and wagering on them during U.S. election periods is not a novel concept. Newspapers based in New York have been publishing daily odds dating back to the late 1800s and early 1900s.
Projects such as Polygon-based Polymarket have capitalized on America’s traditional betting culture by integrating blockchain technology. Established by Shayne Coplan, this online platform has amassed over $2.3 billion in its presidential event contracts. However, it should be noted that Polymarket does not serve U.S. users and has reaffirmed this policy. Despite this limitation, the platform has held a nearly monopolistic position (99% market share) in the prediction sector.
Just like Robinhood, Kalshi serves U.S. clients within the regulatory framework of an exchange. They are considering introducing options for cryptocurrency deposits, expanding their existing digital asset-related marketplaces. Notably, Kalshi also handles settlements in traditional currency.
As a crypto investor, I’ve noticed that prediction markets are still thriving in 2024. More and more people worldwide are turning to alternative data sources and social sentiment indicators for insights. In fact, according to CoinGecko, the event outcome sector has skyrocketed by over 500% in the past year, drawing in new institutional players like Wintermute.
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2024-10-28 16:16