Webull Financial is expanding its digital investment platform to include binary event contracts through a new partnership with Kalshi, the first CFTC-regulated prediction market exchange, as the demand for alternative trading instruments continues to grow.

However, the move occurs as the regulator scrutinizes Robinhood for offering the same instruments.

Webull Teams Up with Kalshi to Launch Prediction Market Trading

The collaboration will enable Webull's users to trade binary event contracts directly through their existing trading platform, expanding into an emerging asset class that has gained traction among retail investors.

“We have continually focused on equipping our customers with the best products and streamlined trading tools while evolving alongside their needs,” said Anthony Denier, Group President and US CEO of Webull. “Offering prediction markets is a key step in fulfilling that commitment.”

The initial phase of the partnership will introduce short-term cash-settled event contracts, with plans to expand into a broader range of economic events. Webull also intends to become a clearing member of Kalshi, deepening the integration between the two platforms.

The move comes as traditional brokerages seek to diversify their offerings amid increasing retail investor interest in alternative investment vehicles. Prediction markets have emerged as one of the fastest-growing asset classes in the United States, allowing traders to take positions on specific event outcomes.

“Event contracts are the next evolution of financial markets,” noted Tarek Mansour, Co-Founder and CEO of Kalshi. “We are excited to partner with Webull to bring this next generation investment opportunity to traders.”

The partnership will include educational initiatives designed to help retail investors understand and navigate the new offering effectively. The official rollout is expected to commence in the coming weeks, pending final implementation details.

Crypto.com and Robinhood Under Scrutiny for Partnership with Kalshi

Although the CFTC regulates Kalshi, some of its listed contracts, particularly those tied to sports events, have raised concerns with the commission.

Last week, Finance Magnates reported that the CFTC had launched an investigation into Super Bowl-related event contracts offered by Crypto.com and Kalshi. The inquiry focuses on whether these contracts comply with derivatives regulations as the market for sports-based trading products continues to expand.

The primary issue under review is whether these event contracts qualify as gambling under existing regulatory frameworks. The CFTC is assessing their compliance with derivatives rules and examining potential risks of market manipulation.

“We are continuing to review the contracts in accordance with our regulations,” a CFTC spokesman stated, noting that the agency plans to hold public roundtables on emerging issues in derivatives markets, including event contracts.

On Sunday, Robinhood, a major retail trading platform, introduced the same event contracts in partnership with Kalshi. This move has drawn attention, raising questions about whether Robinhood might soon face regulatory scrutiny as well.

The CFTC responded swiftly. By Wednesday, February 5, 2025, Robinhood suspended the offering of Super Bowl event contracts just a day after listing them, following the regulator's request.

“While we continue to work with the CFTC to understand their concerns, we are suspending the rollout of the Pro Football Championship market,” Robinhood noted in its official announcement. “We are disappointed by this outcome, especially given that we had been in regular communication with the CFTC about our intent and plans to offer this product.”

Robinhood serves approximately 24.3 million customers worldwide, but according to the company, the Super Bowl event contracts were initially made available to only 1% of its user base. Traders who had already placed orders were given the option to either close their positions or settle them.