(Reuters) – Robinhood said on Tuesday it had suspended trading in Super Bowl betting contracts after the brokerage received a request from the U.S. Commodity Futures Trading Commission.
“We are heeding their directive to cease offering these contracts despite the fact that the CFTC has not deemed Kalshi’s football championship contracts illegal,” said Lucas Moskowitz, Robinhood’s general counsel.
The trading platform had launched the event contracts on Monday to let U.S. customers wager on the outcome of the Super Bowl clash, seeking to tap into the betting mania around one of the most iconic sporting events in the country.
The company said it had rolled out the product to 1% of its customers and those who already placed the trades will get the option to close their positions or take them to resolution.
Event derivatives trading involves buying and selling contracts that let traders speculate on the outcomes of specific events, including elections, economic data releases and policy decisions.
These products have enjoyed a warm reception, despite being relatively new and widely seen as high-risk, especially after a U.S. court struck down the CFTC’s efforts to block KalshiEX’s election betting contracts.
(Reporting by Manya Saini in Bengaluru; Editing by Alan Barona)
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