Crypto Prediction Markets Soar as Robinhood CEO Sees Surge in Trading Volume
Rapid growth in crypto prediction market trading volume is expected to continue, according to Robinhood CEO Vlad Tenev. The company's prediction market activities generated $156 million in revenue in the second quarter, up more than 10-fold year over year. By August 2026, event contracts traded 15 times ahead of the levels of a year ago, with crypto-related contracts becoming a disproportionately large share of that segment. Tenev predicted that sports-related contracts will become the minority within the next few years.
Kalshi, a prediction market provider and one of the exchanges behind Robinhood's contracts, saw crypto prediction market volume increase from $337 million in January 2026 to about $7.5 billion by August. In the week ended September 20, sports contracts still made up 21% of Kalshi's trading volume, while Bitcoin contracts were responsible for 13%, and bets bundling several different outcomes accounted for 62%. These contracts pose short-term questions to traders, such as whether Bitcoin will finish above a target price at the end of a 15-minute window.
Investors should note that predicting short-term price movements of cryptocurrencies is generally a fool's errand, just like it is with stocks. The prediction market operators make money from fees whether the underlying coin goes up or down, so it's in their interest to encourage as much trading as possible. The coins themselves don't change hands as a result of anything happening in the prediction markets.
There is no compelling reason to transition your crypto investing activities into crypto prediction market trading activities. A study of more than 300,000 Kalshi contracts found an average pre-fee loss of 20% per contract, and the probabilities implied by the contracts were too biased to be used as 'true' probabilities. If you're investing for the long term, the resolution of any given 15-minute prediction about Bitcoin's price is not relevant to forming or adjusting an investment thesis for buying and holding it.
The crypto market itself is likely to grow considerably in coming years, and this growth will create some of the anticipated growth in predictions about crypto prices. To get the most direct exposure to upside from the prediction component of that dynamic, buying Robinhood's stock is the most straightforward approach, as it earns revenue from every transaction. However, for those who would prefer to only buy more crypto instead of stocks, there isn't necessarily much to do about or much to worry about regarding the expansion of crypto price prediction contracts.