The most wonderful time of the year is here. No, not spring. Not even tax refund season. I’m talking about March Madness… the glorious stretch where productivity sinks to embarrassingly low levels, office printers work overtime printing out busted brackets, and degenerate gamblers (I mean, investors), put their faith in a bunch of 19-year-olds hitting free throws under pressure.

And right on cue, Robinhood just rolled out its latest trick…  prediction markets, where you can bet (sorry, “trade event contracts”) on the outcomes of basketball games and Fed rates.

Let me repeat, you can now YOLO your rent money on whether a mid-major squad full of future accountants pulls off a Cinderella run to the Final Four… and if Jerome Powell keeps rates steady just to mess with Trump.

This means Robinhood is officially jumping into event-based derivatives, a niche but growing asset class that lets users wager on real-world events with a clean, all-or-nothing payoff.

Now if you remember, this isn't Robinhood's first attempt at prediction markets. The platform previously let users bet on the Super Bowl (before the Commodity Futures Trading Commission shut that down). They also had a brief run at election contracts, where people could speculate on Trump vs. Biden like it was an earnings report.

But now, Robinhood seems to have cleared regulatory hurdles by partnering with Kalshi, a CFTC-regulated exchange. That means, for now, you can legally bet on whether the Fed will cut rates (wildly exciting, I know) and, of course, the NCAA tournament.

Obviously, Vlad (Robinhood’s CEO) didn’t do this out of the kindness of its heart. The company charges a fee of two cents per contract, with one penny going to them and the other to Kalshi. If that doesn’t sound like much, consider that Robinhood made $1.2 billion last quarter off transaction fees alone. If these prediction markets catch on, they could add a serious revenue stream.

And investors seem to love the move… Robinhood’s stock is up 3% on the news. It also doesn’t hurt that a few days ago, Deutsche Bank analysts called the company a “good buying opportunity,” predicting a 60% upside over the next 12 months.

Robinhood is playing a smart game here. Event-based contracts are gaining traction fast, with platforms like Polymarket and Kalshi already pulling in billions of dollars in bets.Of course, regulators are pissed. Some worry this looks too much like gambling (which isn’t that what it is?), while others fear potential market manipulation.

But for now, Robinhood has found a legal way to give retail traders more ways to speculate… and another revenue stream to make shareholders happy.

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Stock.News has positions in Robinhood.