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Robinhood CEO links state prediction market lawsuits to tax incentives
The CEO cited 2025 sports betting tax collections of $3.71 billion, and said New York alone accounts for roughly a third of that total.
Robinhood CEO Vlad Tenev said states that have sued to shut down prediction markets are doing so to protect tax revenue tied to state licensed gambling operations, and he argued there is a “huge financial incentive” to keep those state owned channels protected, according to comments carried by Yahoo Finance.
Tenev pointed to American Gaming Association figures showing state and local tax collections from sports betting totaled $3.71 billion in calendar 2025, up 32.4% year over year, on $16.96 billion of sportsbook revenue and $166.94 billion in handle. He also said New York’s mobile sports betting tax rate of 51% makes it a major contributor, with the state court filing estimating about $2 billion in gross gaming revenue in 2024 and more than $1 billion in state taxes.
The article also contrasts ownership structures, saying state lotteries are state operated and represent a large transfer to beneficiaries, while sportsbooks are companies licensed and taxed by states rather than state owned. It notes that prediction markets have grown quickly, with Kalshi and Polymarket combined for $50.59 billion in trading volume in July, while cautioning that the figure is notional volume rather than revenue or a taxable base.
Finally, the piece adds that while trading volume hit an all time record in July, open interest across the platforms fell from about $2 billion to $1.2 billion, according to data compiled by The Block as referenced in the article.