Robinhood Prediction Markets Surge as Crypto Revenue Falls

Robinhood prediction markets hit 8.8 billion contracts in Q1 2026, while crypto revenue declined 47 percent.

Key Points:

• Robinhood traded 8.8 billion event contracts in Q1 2026, generating $147 million in revenue, a 320% year-over-year jump.
• Crypto trading revenue dropped 47% to $134 million, partially offsetting strong gains from prediction markets and other streams.

Robinhood (Nasdaq: HOOD) recorded explosive demand for its prediction markets platform in the first quarter of 2026, with customers trading 8.8 billion event contracts between January and March.

Although the company did not disclose the exact revenue figure tied solely to event contracts, it reported $147 million from “other transactions,”  a category that primarily covers event contracts. That figure surged 320 percent year over year, underscoring the rapid rise of prediction markets as a core revenue driver for the brokerage.

By comparison, Robinhood processed 8.5 billion event contracts in Q4 2025, up from just 2.3 billion in the prior quarter. In October 2025 alone, customers traded five million contracts, a sign of early but accelerating momentum.

Robinhood officially launched its prediction markets hub in March 2025, opening the platform to event-based trading across political, economic, and sports outcomes. Since then, user adoption has moved quickly.

“In Q1, customers remained engaged and rapidly adopted new products, leading to a 20 per cent-plus annualised net deposit growth rate, double-digit growth across equities and options, and record volumes for prediction markets, futures, and index options,” said Shiv Verma, Chief Financial Officer of Robinhood.

Notably, the company is deliberately narrowing the range of prediction market contracts it offers. Management explained this approach as a way to sidestep concerns around insider trading and market manipulation, issues that have drawn growing regulatory scrutiny across the sector.

Robinhood Prediction Markets Surge as Crypto Revenue Falls

Meanwhile, crypto told a very different story. Cryptocurrency trading revenue fell 47 percent to $134 million in Q1, down sharply from $221 million the previous quarter. The decline, which Robinhood described as “partially offsetting” gains elsewhere, reflects a broader industry-wide cooling in digital asset trading activity. Robinhood app notional crypto volumes dropped 46 percent to $24 billion, with Bitstamp contributing $42 billion in notional volumes.

Despite the crypto headwind, overall transaction-based revenue climbed 7 percent to $623 million for the quarter. Total net revenue reached $1.07 billion, representing a 15 percent increase year over year, though both figures came in below Q4 2025 levels of $1.28 billion in total revenue and $776 million in transaction-based revenue.

On the cost side, Robinhood spent $14 million last quarter on the development of Rothera and Trump Accounts. The company now expects to invest an additional $100 million to build and support the user interface for Trump Accounts, an amount that was not included in its earlier financial outlook.

Investors reacted cautiously to the results, sending shares down nearly 10 percent in after-hours trading following the earnings announcement.

Nevertheless, Robinhood closed Q1 with $346 million in net income, a 3 percent improvement. Diluted earnings per share also rose 3 percent, reaching $0.38.

Looking ahead, Verma struck an optimistic tone about the second quarter. “Q2 is off to a good start in April, as equity and option trading volumes are on track to be the highest month of the year, and even with tax season, net deposits are approximately $5 billion month-to-date,” he said.

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