- Webull will offer Kalshi event contracts in sequential order.
- The CFTC is reviewing sports-related event contracts for compliance.
Webull has collaborated with the Kalshi prediction market to bring event contracts to its platform. Webull will introduce cash-settled prediction contracts to its users over a few weeks. Initially, the products will be limited, but Webull plans to expand its product line in the future.
Webull is the second brokerage company to list Kalshi’s event contracts following Robinhood. The launch is concurrent with regulatory interest from the Commodity Futures Trading Commission (CFTC), which has previously started scrutinizing sports-related event contracts. The regulators have expressed concern over whether the financial product meets US derivatives regulations.
Webull Expands With Kalshi Event Contracts
The CFTC probe follows a series of events between Crypto.com and Robinhood. In January, the agency reviewed Crypto.com’s upcoming Super Bowl contracts. The CFTC had by February 4 officially opened an investigation into Crypto.com and Kalshi, prompting Robinhood to cancel its own Super Bowl contracts a day after it had rolled them out.
Robinhood was taken aback by the regulatory action, saying that the firm had been having ongoing talks with the CFTC about its products. Despite these issues, Kalshi continues to grow, using alliances with large brokerages to bring prediction markets to the retail trader.
Event contracts are distinct from sports betting in that they are based on the crowd’s wisdom, not on a bookmaker determining odds. Sports betting is a house-biased proposition, whereas prediction markets are decentralized and market-driven. This is the crux of current regulatory controversies, with authorities considering event contracts’ legality and business model.
As Webull prepares to roll out Kalshi’s contracts, the industry awaits further regulatory clarity. The success of these offerings could depend on how the CFTC chooses to classify and regulate them in the evolving landscape of prediction markets.
