Robinhood halts Super Bowl betting after CFTC request
CFTC forces Robinhood to suspend Super Bowl bets
Robinhood, a leading online trading platform, has suspended its newly launched Super Bowl betting market following a request from the U.S. Commodity Futures Trading Commission (CFTC).
The decision comes just a day after the platform introduced event contracts, allowing users to bet on the outcome of the National Football League (NFL) championship game between the Philadelphia Eagles and the Kansas City Chiefs, scheduled for February 9.
CFTC intervention halts event contracts
In a statement released on February 4, Robinhood announced that the CFTC had formally requested its subsidiary, Robinhood Derivatives, LLC (RHD), to discontinue customer access to sports event contracts. In response, Robinhood immediately suspended the rollout of its Pro Football Championship market while continuing discussions with regulators to address their concerns.
"As we continue working with the CFTC to understand their concerns, we are suspending the rollout of the Pro Football Championship market," the company stated. "We have rolled out this product to approximately 1% of our customers, and for those who have already placed trades, we plan to offer the option to close their positions or allow them to be resolved."
Regulatory pushback and Robinhood’s response
Robinhood expressed disappointment over the regulatory intervention, noting that it had maintained open communication with the CFTC throughout the planning and launch process. The company emphasized its proactive engagement with regulators, including participation in CFTC roundtables and submitting formal feedback regarding event contracts.
"We are disappointed by this outcome, especially considering that we were in regular communication with the CFTC about our intentions and plans to offer this product," the statement read. "We have also taken steps to advocate for balanced regulation in the futures and derivatives markets, including direct participation in a CFTC roundtable, submitting written feedback to the CFTC, and actively promoting the economic benefits of event contracts."
The future of event contracts on Robinhood
Despite the setback, Robinhood remains committed to expanding its event contract offerings. The company confirmed that it would continue working with the CFTC to develop a more comprehensive event trading platform, with plans for a broader launch later this year.
This suspension marks a significant regulatory hurdle for Robinhood, which has been striving to diversify its trading products beyond stocks and cryptocurrencies. While the company has not disclosed the specific concerns raised by the CFTC, the incident highlights ongoing regulatory scrutiny of financial products that blur the lines between trading and gambling.
For now, users who placed Super Bowl bets through Robinhood will have the option to close their positions or let them reach resolution. However, the future of sports event contracts on the platform remains uncertain as regulatory discussions continue.
