Robinhood Derivatives introduced that the Commodity Futures Buying and selling Fee (CFTC) has requested it “not allow prospects to entry” sports activities occasion contracts.
In response, Robinhood is suspending the rollout of its Professional Soccer Championship market, which had been launched to roughly 1% of its customers.
CFTC Blocks Robinhood’s Sports activities Betting
Based on the official press release, the corporate stated that prospects who’ve already positioned trades could have the choice to both shut their positions or see them by to decision. Robinhood expressed disappointment with the choice, stating that it had been in common communication with the CFTC concerning its intent and plans for the product.
Robinhood maintained that it had taken needed steps to advocate for balanced regulation within the futures and derivatives markets. This contains collaborating instantly in a CFTC roundtable and offering written suggestions to the watchdog. The monetary companies firm, nonetheless, assured that
“RHD will proceed to collaborate with the CFTC as we work to roll out a extra complete occasion contracts platform later this yr.”
CFTC’s Elevated Scrutiny
The most recent growth emerged only a day after Robinhood launched sports activities occasions contracts in partnership with prediction market Kalshi. The product allowed customers to commerce on the end result of the Philadelphia Eagles vs. Kansas Metropolis Chiefs Tremendous Bowl sport scheduled for February 9.
This determination follows elevated scrutiny from the Commodity Futures Buying and selling Fee (CFTC), which is at the moment reviewing related Tremendous Bowl occasion contracts provided by Crypto.com and Kalshi.
The company is assessing whether or not these contracts meet derivatives compliance requirements and safeguard in opposition to market manipulation. The CFTC has the authority to demand additional documentation and will provoke enforcement actions or suggest new regulatory measures.
The suspension got here amid broader regulatory tightening on occasion contracts, with the CFTC not too long ago saying plans for public roundtables on the problem. Crypto.com has maintained its confidence within the legality of its contracts, stating that it views the CFTC as the suitable authority to make sure market integrity
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