Polls were closing. Money was pouring into midterm bets. And Robinhood users say the company's prediction market stopped letting them out.
Starting around 8 p.m. Eastern on election night, traders on X reported they could not sell, buy or change their midterm positions on Robinhood. One user posted a screenshot of the notice the app showed them: "We're experiencing issues on this prediction market. We're aware and working to resolve this as quickly as possible." That post went up at 8:16 p.m. Eastern. "I'm frozen into every position," the user wrote.
Two hours locked in
The complaints kept coming as the night broke for Democrats. At 9:34 p.m., a trader with about 14,000 followers wrote that Robinhood's prediction markets had been "completely frozen for 2 hours," and posted positions on the Florida governor, Wisconsin governor and Texas Senate races. At 9:52, another user said sell orders were being rejected. At 10:05, a third wrote that they could not sell or buy anything.
Ten minutes later, CBS News called the House for Democrats. That is the hour prices swing hardest, and the hour a frozen bettor can only watch. A position you cannot sell is money you cannot get out.
The money Robinhood makes on this
Prediction markets are no side project. Robinhood booked $173 million from event contracts last quarter, more than six times a year earlier, on 16.4 billion contracts traded, according to its third-quarter results. The business now outearns its crypto desk, while the stock sits roughly 40 percent below its 2025 high.
And Robinhood does not run the whole machine. Its contracts run through outside exchanges: Kalshi, ForecastEx, the North American Derivatives Exchange and Rothera, its new venture with Susquehanna. When something breaks, customers get a banner, not an explanation.
What Robinhood has said
Nothing public, as of Wednesday morning. BTP found no statement on Robinhood's X account or in news coverage explaining what failed, which markets froze, how long the freeze lasted or whether anyone will be made whole. No outlet had reported the outage when BTP reviewed coverage on November 4.
The fair point
These accounts come from users, and the length of the freeze rests on what they posted. Some traders came out ahead; the 14,000-follower trader said they were "up." Bettors who held through the night still get paid when contracts settle, though Robinhood says settled cash typically takes a business day before it can be withdrawn. The harm falls on people who wanted out mid-race and could not get out.
Who pays
Robinhood earns a fee on every contract it routes. Its customers carried the risk when the doors locked.
The question for Robinhood: how many customers were stuck, for how long, and who covers what they lost?
A market you can't leave is a casino where the house owns the exit.