Massachusetts Probes Robinhood's Sports Betting Platform

Massachusetts has launched an investigation into Robinhood's new prediction-markets hub that lets users bet on event outcomes like college basketball tournaments. The probe led by Secretary of State Bill Galvin focuses on concerns about linking gambling with brokerage accounts. A subpoena demanding internal details has been issued.

Massachusetts' top securities regulator has opened an investigation into Robinhood's recent venture into prediction markets, which allows for bets on events such as college basketball tournaments. Concerns have been voiced about the potential risks of linking such activities with brokerage accounts.

State Secretary Bill Galvin, noted for his stringent regulatory approach, has expressed unease with Robinhood's new service, describing it as a 'gimmick' aimed at attracting young investors away from more stable investment avenues. His office has issued a subpoena seeking detailed information on the involvement of Massachusetts residents in these trading activities.

Robinhood's latest offering, which launched in collaboration with KalshiEX, comes after previous pushbacks from the U.S. Commodity Futures Trading Commission. This marks another chapter in the ongoing legal challenges between Galvin's office and the trading platform.

(With inputs from agencies.)