Trading platform Robinhood is facing a proposed class action lawsuit alleging that its prediction market offerings amount to illegal sports betting in several US states.
The complaint, filed by Georgia resident Matthew Mazza in a federal court in California, argues that Robinhood is offering sports event contracts as financial products when, in essence, they are sports gambling.
Mazza believes users of the platform were misled into believing they were participating in regulated financial investing. According to the suit, Mazza alleges that he lost US$400,000 in fees and commissions from wagering on sports-event contracts offered by Robinhood between 2025 and 2026.
