- CEO of a trading app Robinhood’s Vlad Tenev, who trades a wide range of asset classes, defended prediction markets, saying speculation is an integral part of any market.
- According to him, no one can tell a person who has his own strategy how and what to trade.
During Conference Wall Street Journal “The Future of Everything” May 5 Robinhood CEO Vlad Tenev expressed regarding prediction markets, noting that speculators are necessary for any market to function.
“A financial market can’t function without speculators. If everyone just hedges their risks, the market will collapse,” Tenev responded to a question about whether prediction markets can be considered gambling. “If you have a strategy, and it’s systematic, who am I to say you shouldn’t trade this asset class?”
That same day, on CNBC, Tenev called prediction markets “a great source of information,” and Robinhood will be developing a product line based on that.
Interestingly, on May 5th the prediction market team Kalshi closed a $1 billion funding round at a $22 billion valuation.
According to the company, as of March, transactions worth more than $52 billion had been completed on its exchange. Trading volume + Kalshi reached $4,47 billion over the past month, while the competing platform polymarket the same figure was $3,58 billion.
Regulators are increasingly scrutinizing prediction markets, with lawmakers in some states not only comparing some bets to gambling but also pointing to instances of insider trading.
The platform’s regulated status has forced Kalshi Suspend and fine several political candidates for betting on their own campaigns. According to the company’s rules, betting on events that a participant can directly influence is prohibited.
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