Robinhood Markets Inc.’s prediction-markets business received a subpoena from Massachusetts’ Secretary of State Bill Galvin, who’s looking into links to gambling for its sports-event contracts, especially for younger users.
Galvin issued the subpoena last week seeking information on how Robinhood users in Massachusetts have traded college sports-events contracts, particularly as the men’s and women’s college basketball tournaments got under way, according to a spokesperson for Galvin’s office.
“The event contracts offered by Robinhood Derivatives are regulated by the CFTC and offered through CFTC-registered entities,” a Robinhood spokesperson said in an emailed statement.
“Prediction markets have become increasingly relevant for retail and institutional investors alike, and we’re proud to be one of the first platforms to offer these products to retail customers in a safe and regulated manner,” the firm added.
Robinhood recently came under scrutiny and had to pull its sports-event contract betting for the Super Bowl in February, after a formal request for a suspension from the Commodity Futures Trading Commission.
The CFTC was probing whether the contracts constitute sports betting.
Reuters reported the Massachusetts subpoena earlier Monday.
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