Prediction markets have quickly become Robinhood Markets’ (NASDAQ: HOOD) fastest-growing business line on record—a milestone that is now drawing increasingly bullish commentary from Wall Street analysts.

In a report out Monday, Bernstein analyst Gautam Chhugani reiterated the view that Robinhood’s prediction market revenue will hit $1.7 billion in 2028, slightly eclipsing the $1.6 billion the analyst expects the company will generate from cryptocurrency trading.

Boosting top-line estimates for Robinhood by 3% for 2026, 4% for 2027, and 3% for 2028, Chhugani estimates event contracts will drive $650 million in revenue for the brokerage house this year, implying that figure is poised to more than double by 2028.

California-based Robinhood delivers third-quarter results after the close of U.S. markets on Tuesday, Oct. 27 and there could be more clarity on the prediction market growth front. In the second quarter, Robinhood’s prediction market revenue topped its cryptocurrency business on a quarterly basis for the first time.

Coinbase Commanding PM Growth, Too

On a market share basis, the U.S. prediction market industry remains largely dominated by two primary operators, but major brokerage platforms including Robinhood and Coinbase Global (NASDAQ: COIN) are rapidly making inroads.

Coinbase, the largest U.S.-based cryptocurrency trading exchange, is also experiencing strong expansion in prediction markets. Chhugani forecasts $2 billion in revenue from event contracts and derivatives products for Coinbase by 2028, more than tripling the $600 million expected this year. These derivative offerings include perpetual futures contracts (“perps”).

Coinbase, which offers event contracts through a partnership with one of the largest prediction market operators, may be one of the industry upstarts ideally positioned to capitalize on growth due to its enviable financial position and because of its deep ties to cryptocurrency. Digital currency event contracts are one of the fastest-growing non-sports segments in the prediction market industry today.

Why Prediction Market Growth Matters to Brokers

Next-generation online brokerages, including Coinbase and Robinhood, are realizing substantial top-line gains from event contracts—though their ultimate goal isn’t to operate as pure-play betting operators.

While prediction market platforms generate standalone revenue from transaction and trading fees, their primary value for financial services firms lies in customer acquisition. Robinhood leadership recently noted that a significant portion of retail traders who join the platform for yes/no event contracts eventually transition into trading traditional options, futures, and opening retirement accounts.

When properly executed, prediction markets act as high-conversion acquisition funnels, creating engaged, long-term clients across broader financial product suites.