Massachusetts Regulator Probes Robinhood Over Prediction Markets Hub: Reuters

The Prime Securities Regulator of Massachusetts has reportedly launched a probe in Robinhood in regards to the current determination of the favored buying and selling platform to launch a hub within the app prediction markets with which clients can wager on the result of occasions, together with March Insanity-Match-ups.

In line with a Monday report from Reuters, Massachusett’s Secretary or State Invoice Galvin – despatched a infamous aggressive regulator – Robinhood Final week a summons in search of details about the variety of customers of Robinhood in Massachusetts who requested to buying and selling sport occasion contracts, and the seek for copies of Robinthood’s associated advertising.

“That is simply one other gimmick from an organization that is superb in Gimmicks to lure traders away from sound funding,” Galvin instructed Reuters. The Galvin workplace confirmed the investigation into Coindesk and added that Robinhood’s response to the summons must be on 3 April.

The forecast market of Robinhood, which is powered by the Commodity Futures Buying and selling Fee (CFTC)-regulated Kalshi, launched on 17 March with March Insanity-related occasion contracts, in addition to one other linked to the higher restrict of the Fed Funds fee goal in Could. On the time of the launch, Robinhood Coindesk instructed that it had been in communication with the CFTC “in current weeks” previous to the launch.

A Robinhood spokesperson repeated that the occasion contracts supplied by way of its HUB prediction markets “had been regulated by the CFTC and supplied through CFTC-registered entities.”

“Desire markets have turn into more and more related for each retail and institutional traders, and we’re proud to be one of many first platforms to supply these merchandise to retail clients in a protected and controlled manner,” the spokesperson added.

The buying and selling platform beforehand tried to launch its prediction markets hub in February, previous to the Tremendous Bowl, however delayed the launch on the request of the CFTC.