Prediction market platform Robinhood is hitting pause on all sports event contracts in Michigan due to an ongoing lawsuit from the Michigan Gaming Control Board (MGCB).
Key Takeaways
- Robinhood will stop offering new sports prediction contracts in Michigan and close remaining customer positions next month.
- The agreement follows Michigan’s ongoing legal battle with prediction market operators over sports contracts’ legality.
- Michigan officials say the agreement protects consumers.
The MGCB announced Wednesday that the prediction market operator would halt new sports-related contracts by the end of the day and close remaining customer positions by Oct. 9, per a court-approved agreement.
“This agreement is another win for Michigan consumers,” said MGCB executive director Henry Williams. “Sports wagering products should only be offered by operators who are licensed, regulated, and held accountable under Michigan law.”
The agreement comes following a slew of prediction markets in the state facing questions over their legal standing, dating back to Michigan suing Kalshi back in March.
“We’re pleased Robinhood has agreed to step back from offering these unregulated products while the courts continue to sort out the broader legal questions, and we’ll keep working with the Attorney General’s office to make sure Michigan consumers are protected.”
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Robinhood decision comes during continued Michigan legal fight
Kalshi previously put “restrictions” in place in the state back in June as a result of the lawsuit, making Robinhood the second operator to make prediction market news with its decision. Notably, less than two weeks after Kalshi’s decision, the CFTC instructed the operator it would be required to fulfill open trades in Michigan regardless of the state’s decision, hence Robinhood’s Oct. 9 buffer to close remaining customer positions.
“Throughout this litigation, our priority has been protecting Michigan consumers from exploitative practices and ensuring betting in our state remains fair and regulated,” said Michigan Attorney General Dana Nessel. “I am proud of the dedicated attorneys in my office for securing an agreement that protects Michiganders while our case moves forward.”
More recently, AG Nessel secured an injunction at the beginning of September to halt Kalshi from unlawfully offering sports contracts within the state.
“Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” Nessel said in the prior release. “My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities.”
