Prediction Markets | 2026.06
With the World Cup around the corner, there is growing anticipation around how prediction markets will perform.
YTD, the most notable changes have been:
1) $Kalshi’s stellar growth, with volume up roughly 90% from January to May; and
2) the growing divergence between $Kalshi and $HOOD’s prediction-market volume.
$HOOD used to represent roughly 50–60% of $Kalshi’s implied volume. That ratio has declined every month this year, falling to 22% by April 2026. $HOOD’s own prediction-market volume has been essentially flat YTD.
Source: HOOD monthly disclosed by company; Kalshi daily from public data tracking
At first glance, one might assume $Kalshi is intentionally directing volume away from $HOOD and “cutting $HOOD out.” But this is more of a pull model than a push model. In my view, the issue is more likely on $HOOD’s side.
There are a few possible explanations.
First, $Kalshi has added new distribution and exchange partnerships, including Coinbase.
It is estimated that $Kalshi is now generating 60%+ of volume from its own platform/API, with the remainder coming from broker partners including $HOOD, Coinbase, PrizePicks, and others. $Kalshi went viral in 1Q, helped by strong momentum around the Super Bowl and March Madness.
Second, $HOOD’s current product supply is more limited, while $Kalshi has seen growth in non-sports contracts.
$HOOD remains very sports-heavy.
$Kalshi is also still sports-heavy, with sports representing roughly 80% of YTD 2026 volume. But $Kalshi’s non-sports share has increased from 9% in December 2025 to roughly 20% by March 2026.
Looking forward, $HOOD’s own prediction-market JV appears to have come online right before the World Cup.
Rothera recently went live, likely in late May or early June 2026, and $HOOD has now begun routing at least some prediction-market flow to Rothera. Rothera is operated by the $HOOD/SIG JV. $HOOD is the controlling partner, SIG provides liquidity, and MIAXdx provides the CFTC DCM/DCO infrastructure.
On unit economics, the current $Kalshi-distributed-through-$HOOD model appears to be: the customer pays 2 cents, with 1 cent going to $HOOD and 1 cent going to $Kalshi. With the new JV, $HOOD can technically capture more of the economics. The open question is whether $HOOD will keep that incremental margin, or use a better and cheaper product to acquire customers — consistent with how the company has competed in other verticals.
The World Cup will be an important test. It remains to be seen whether $HOOD becomes more aggressive on customer acquisition and product promotion around the event.
Medium to long term, $HOOD likely needs to broaden its prediction-market product offering beyond sports. If the company wants to close the gap with $Kalshi, distribution alone may not be enough. The product surface area needs to expand.
h/t BAML
Source: BAML, Kalshi: Trade on everything, 04/08/2026
https://robinhood.com/us/en/newsroom/the-world-cup-is-now-trading-on-robinhood-and-rothera/
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