Robinhood (HOOD) Stock Rallies 10% After Prediction Markets Partnership

TLDR

• Robinhood shares climbed more than 10% following the announcement of a partnership with Susquehanna International to expand prediction market services
• The deal includes acquiring a 90% stake in LedgerX, a derivatives exchange formerly owned by FTX
• More than 1 million users have traded 9 billion contracts since Robinhood launched prediction markets last year through Kalshi
• The platform is projected to generate over $300 million annually from event contracts according to Bernstein analysts
• Year to date, Robinhood stock has gained 215%, ranking as the S&P 500’s second-best performer in 2025

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Robinhood stock jumped over 10% on Wednesday as the company announced plans to deepen its presence in the rapidly growing prediction markets sector. The trading platform revealed a partnership with Susquehanna International to launch a new futures and derivatives exchange.

Robinhood Markets, Inc., HOOD

The deal centers on acquiring LedgerX, a derivatives platform previously owned by the collapsed FTX crypto exchange. Robinhood and Susquehanna will control 90% of LedgerX through the arrangement. Miami International Holdings will retain the remaining 10% stake.

The transaction is set to close during the first quarter of 2026. Financial terms were not disclosed in the announcement.

Prediction markets let users trade contracts based on future event outcomes. These range from sports game results to Federal Reserve policy decisions. The space has seen explosive growth over the past year.

Robinhood entered this market in 2024 through a deal with Kalshi. The results have been strong. Over 1 million users have executed 9 billion contracts since the service launched.

Capturing Market Share

The company currently represents more than half of Kalshi’s total trading volume. This positioning gives Robinhood leverage as it moves to capture more revenue in the space.

Bernstein analysts project the platform could hit $300 million in annualized revenue from event contracts. The firm rates the stock as a Buy with a $160 price target.

Analyst Gautam Chhugani highlighted Robinhood’s 14 million active traders as an ideal user base for prediction markets. This demographic aligns well with the product’s target audience.

The new exchange will allow Robinhood to offer additional contracts directly rather than solely distributing through Kalshi. This gives the company greater control over its product offerings and revenue streams.

Growing Institutional Interest

Prediction markets have attracted attention from major financial players. Last month, Intercontinental Exchange put $2 billion into Polymarket, currently the largest prediction market globally.

Susquehanna will function as a liquidity provider in the new arrangement. Liquidity providers are critical for maintaining stable pricing in active trading environments.

Robinhood stated the exchange will increase consumer options while providing flexibility to develop new products faster. The company plans to roll out additional contracts and services for traders.

Shares closed Wednesday at $128.20, up $12.63 from the previous session. After-hours trading saw the stock add another 0.47% to reach $128.80.

Robinhood has gained 215% in 2025, making it the second-best performing stock on the S&P 500 this year. The company joined the index in September following its strong performance.

Bernstein analysts expect Robinhood to continue its partnership with Kalshi while simultaneously building out proprietary offerings through the new exchange.

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