Author | Azuma (@Azuma_eth)
The flames of the World Cup have ignited, and the total global trading volume of prediction markets continues to hit new highs. However, as the industry leader, Kalshi may not be in the best mood at the moment.
The reason is not a fluctuation in Kalshi's own business data, but because Kalshi now "suddenly" faces another formidable rival after Polymarket, and this opponent was once its most important ally.
- Odaily Note: Data sourced from Defillama.
Kalshi's Most Important Traffic Channel — Robinhood
Rewind to March 2025. At that time, Kalshi announced a partnership with the US online brokerage Robinhood. The latter would use Kalshi's services to provide its users with prediction market trading, allowing users to place bets on political, economic, sports, and other events.
From a business model perspective, this was a classic case of "mutual benefit" — Robinhood, responsible for user access and order flow distribution, could directly utilize Kalshi's mature product; Kalshi, responsible for the underlying market, matching, clearing, and regulatory compliance systems, could access Robinhood's massive pool of retail traffic.
The subsequent story proved the "win-win" outcome of this collaboration. Through Robinhood's channel distribution, Kalshi indirectly gained a massive amount of users and transaction volume. Piper Sandler analysts once estimated that "transactions completed through the Robinhood channel accounted for about 25%-35% of Kalshi's total trading volume." These orders ultimately translated into revenue for both parties — Robinhood charges an independent fee for all Kalshi event contracts traded through this channel, $0.01 per contract per side, and then shares the revenue with Kalshi (the specific split was not disclosed).
The Q1 financial report released at the end of April this year showed that Robinhood achieved trading of 8.8 billion event contracts in Q1, driving "other transaction revenue" to grow 320% year-over-year, reaching $147 million. Prediction markets have become the most eye-catching new growth engine in Robinhood's product line.
But recently, this relationship has undergone some subtle changes.
Robinhood's Ambition: Reclaiming the Cake Shared with Kalshi
As countless episodes in internet history have proven, when a channel gains sufficient influence, it is no longer content with just being a channel. Robinhood is no exception.
Although the cooperation with Kalshi also brought Robinhood considerable revenue, with prediction markets becoming one of the fastest-growing new businesses on the platform, Robinhood was no longer satisfied with the current revenue-sharing arrangement.
In their partnership model, Kalshi provided the market and infrastructure, while Robinhood provided the users and order flow. However, as the cooperation deepened, Robinhood gradually realized that what was truly scarce might not be the market itself, but the user access point it firmly controlled. After all, for most Robinhood users, they don't care whether their orders are ultimately executed on Kalshi or another platform — users only see a trading entry point within the Robinhood app, not the underlying infrastructure provider.
In other words, Robinhood always controlled one of the most critical resources in prediction markets — distribution power. If the users belong to Robinhood, why should the orders flow to someone else?
In fact, while Robinhood was quickly validating the demand for prediction markets with Kalshi, another Plan B was launched shortly after.
In November 2025, Robinhood announced the establishment of a joint venture with Wall Street quantitative trading giant Susquehanna, planning to acquire the CFTC-regulated derivatives exchange MIAXdx. According to the official statement, the joint venture would operate an independent futures and derivatives exchange and clearing agency in the future, with prediction markets being one of its key focuses. At the time, the outside world mostly viewed this as an infrastructure investment. However, with subsequent information disclosures, people gradually realized that Robinhood's goal was far beyond just finding a new partner for prediction markets.
In January 2026, the deal was officially completed. Robinhood and Susquehanna gained 90% control of MIAXdx, simultaneously acquiring a complete CFTC regulatory framework, including Designated Contract Market (DCM) and Derivatives Clearing Organization (DCO) qualifications. Subsequently, MIAXdx was renamed Rothera Exchange, and its clearing agency was renamed Rothera Clearing.
Thus, Robinhood now possessed the core elements needed to independently operate a prediction market. The only thing lacking was a mature product comparable to Kalshi's, but for Robinhood, with its rich experience in internet product development, this was clearly not a difficult task.
Rothera's Opportunity: The World Cup
In June 2026, after about six months of accelerated development, the Rothera product took shape, and Robinhood finally made the move that was almost destined to happen — gradually shifting orders that originally flowed to Kalshi into its own controlled system.
Robinhood specifically chose an excellent launch battleground for Rothera — the World Cup. For prediction markets, the World Cup is undoubtedly one of the most traffic-generating trading themes. Whether it's match outcomes, qualification results, or the ultimate champion, related markets can attract a large number of new users to trade in a short period. For Rothera's nascent platform, there is no better scenario for a cold start than the World Cup.
According to Robinhood's official disclosure, during this World Cup, which comprises a total of 104 matches, part of the event contracts will be directed to Rothera for matching and clearing, including markets for single World Cup match results, the ultimate World Cup champion, total goals in a single match, etc. Compared to the previous model that completely relied on Kalshi, this marks the first time Robinhood has directed prediction market orders into its own trading system on a large scale.
Judging by the results, Rothera clearly seized this opportunity. According to data disclosed by Hood House, a research-focused自媒体 tracking Robinhood's activities, on June 12th, Rothera completed 44.2 million contract trades, corresponding to approximately $24.4 million in dollar trading volume; on June 13th, Rothera completed 69.7 million contract trades, corresponding to approximately $20.9 million in dollar trading volume... Although these figures still lag behind Kalshi's popular markets, which often see hundreds of millions or even billions of dollars in volume, considering that Rothera has literally just launched a few days ago, this performance is sufficiently successful.
For both Robinhood and Kalshi, this means the balance of cooperation between them has begun to tilt. From Robinhood's perspective, the transaction fee revenue that previously had to be shared with Kalshi can now be retained more within its own ecosystem; from Kalshi's perspective, this means that one of its former most important growth engines has begun to show signs of weakening.
And the World Cup is clearly just the beginning of Rothera's encroachment on Kalshi. Looking further into the future, Robinhood will inevitably expand Rothera's coverage to more sports events, as well as economic and political themes. Those orders that originally flowed to Kalshi will then be intercepted one by one by Rothera.
Since Robinhood and Kalshi have never publicly disclosed their revenue-sharing ratio, we cannot know the exact value of this interception. However, considering that Robinhood alone generated $147 million in prediction market-related revenue in Q1, and with the World Cup in Q2 and the midterm elections later expected to bring even larger-scale trading activities, the annual value of this interception could reach billions of dollars.
Who Controls Distribution, Controls Everything
The drama of Robinhood and Kalshi moving from allies to rivals once again illustrates a logic repeatedly verified in the internet market — products are easy to build, traffic is hard to find; whoever controls distribution controls everything.
Over the past few years, the market generally believed that Kalshi's core moat came from regulatory licenses, exchange qualifications, and clearing capabilities. Therefore, whether it was brokerages like Robinhood or various media outlets, communities, and traffic platforms, they were essentially just Kalshi's channels and traffic inlets. However, the emergence of Rothera proves one thing: in today's market where products are highly homogenized, the product itself might not be the most important element. What remains truly scarce is always the users.
Where the users are, the liquidity is; where the liquidity is, the market will be. When Robinhood controls the access point to tens of millions of retail users, it has the full ability to direct these users to any trading venue. For users, they don't care whether their orders are ultimately executed on Kalshi or Rothera. As long as the experience isn't significantly different, it doesn't matter who is behind the matching and clearing.
If the theme of the prediction market industry in the past few years was the market competition between Polymarket and Kalshi, then the theme for the coming years might become a channel war. Robinhood incubating Rothera is, in essence, a reverse integration launched by the channel side towards the market layer. As more and more platforms with traffic inlets begin to recognize the strategic value of prediction markets, similar stories are likely to continue. Whether they are exchanges, brokerages, social platforms, or media platforms, all could become new gateways to prediction markets.
And when inlets begin to control markets, and channels begin to possess pricing power, the ultimate winner in the prediction market industry might no longer be the platform responsible for matching orders, but the one closest to the users, the one that best controls distribution.
It was true in the internet era, and it was true in the mobile internet era. This time, there are no exceptions either.
