Robinhood Derivatives has taken authorized motion towards regulators in Nevada and New Jersey, accusing the states of unfairly blocking its entry into the sports activities occasion contracts market regardless of latest federal courtroom rulings in favor of rival platform Kalshi.
Key Takeaways:
- Robinhood sued Nevada and New Jersey regulators, alleging they blocked its occasion contracts regardless of federal rulings favoring Kalshi.
- The corporate argues regulators are ignoring courtroom orders, creating an uneven enjoying discipline within the sports activities occasion contracts market.
- Robinhood is looking for courtroom orders and non permanent restraining orders to forestall enforcement actions whereas its lawsuits proceed.
In complaints filed Tuesday, Robinhood stated it started providing occasion contracts in each states after federal judges dominated earlier this 12 months that Nevada and New Jersey gaming regulators couldn’t implement their bans towards Kalshi, which provides contracts regulated by the U.S. Commodity Futures Buying and selling Fee (CFTC).
Robinhood Claims Regulators Creating Uneven Taking part in Subject
Robinhood argued that regulators have ignored these rulings and continued to threaten enforcement motion, creating an uneven enjoying discipline.
“If state regulators are permitted to behave towards Robinhood however not Kalshi, then Robinhood will lose out within the sports activities occasion contracts house,” the corporate stated in its filings.
The lawsuits comply with Kalshi’s personal authorized battles earlier this 12 months. The prediction market sued each states after receiving cease-and-desist letters over its sports activities betting contracts, contending that federal oversight by the CFTC preempted state playing legal guidelines.
Federal courts sided with Kalshi and barred state regulators from intervening, although each circumstances stay lively.
Robinhood now claims the identical safety ought to apply to its derivatives platform, which facilitates buying and selling of occasion contracts that in the end choose Kalshi.
These contracts enable customers to invest on outcomes starting from sports activities video games to elections and are pitched as a solution to convey extra transparency and truth-resolving mechanisms into markets.
Robinhood isn’t just a buying and selling app anymore and with kalshi it’s now constructing prediction markets on NFL and NCAA video games.
On paper, it seems like a pure extension. Soccer is america’s largest sport so liquidity is assured however the framing is essential. Robinhood doesn’t name… pic.twitter.com/fHOiJ52EnD— Ignacio Palomera (@MrIPalomera) August 19, 2025
In its New Jersey criticism, Robinhood stated it contacted the state’s Division of Gaming Enforcement to verify it might function beneath the courtroom’s Kalshi ruling.
Officers allegedly refused to decide to standing down and didn’t reply to a number of follow-up requests for conferences.
An analogous conflict unfolded in Nevada, the place Robinhood claims the state’s Gaming Management Board warned it will deal with any providing of occasion contracts as “willful violations” of legislation, regardless of an area federal courtroom siding with Kalshi.
In each circumstances, Robinhood has requested the courts to subject orders stopping regulators from appearing towards it.
The corporate can also be looking for non permanent restraining orders to defend its enterprise whereas the fits transfer ahead.
Robinhood Faces EU Scrutiny Over Controversial Tokenized Inventory Launch
In the meantime, Robinhood has come beneath regulatory fireplace within the EU after launching tokenized inventory merchandise linked to non-public firms like OpenAI and SpaceX.
The Financial institution of Lithuania confirmed it’s investigating the legality and investor disclosures associated to those blockchain-based “Inventory Tokens,” which launched on June 30.
OpenAI publicly disavowed any connection, stating it by no means authorized the tokens and warning buyers to be cautious.
The controversy escalated when Elon Musk, reacting to OpenAI’s denial, labeled the agency’s fairness “pretend,” however didn’t straight handle the SpaceX tokens.
Robinhood clarified that its tokens usually are not precise shares however price-tracking derivatives issued on Ethereum’s Arbitrum community, out there solely within the EU.
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