StoneX Sees 45% Upside for Robinhood as Layer 2 and Prediction Markets Accelerate

Robinhood is attracting a more bullish Wall Street outlook as its expansion into blockchain infrastructure and prediction markets begins to create new growth opportunities.

StoneX Financial has initiated coverage of Robinhood with a Buy rating and a $170 price target, implying roughly 45% upside from the company's Tuesday closing price of $117.34. Analyst Mark Palmer said nearly every major operating metric at Robinhood is accelerating.

The call comes as Robinhood increasingly moves beyond its traditional retail brokerage business, with Robinhood Chain and prediction markets emerging as two important growth pillars.

Robinhood Chain Becomes a Key Growth Driver

Robinhood Chain is central to the StoneX investment thesis.

The Ethereum Layer 2 launched on mainnet on July 1, initially targeting tokenized stocks and other real-world assets. Since then, activity on the network has expanded rapidly, with speculative trading and decentralized applications also contributing to its growth.

StoneX noted that Robinhood Chain generated roughly $4.59 million in daily fees on September 3, while annualized revenue was approaching $39 million as of August 29. The research firm estimates that the chain could eventually generate approximately $980 million in revenue by fiscal 2029, assuming an 85% margin.

The growth has already attracted significant attention. Robinhood Chain recently surpassed $34 billion in cumulative DEX volume and approached $1 billion in DeFi liquidity, although much of its current activity has been driven by memecoins and speculative markets rather than Robinhood's retail customers.

That distinction could become important for the long-term investment case.

Robinhood's biggest potential advantage is its existing customer base. If the company eventually brings a meaningful portion of its retail users onto the chain for tokenized stocks, crypto and other onchain products, activity could expand significantly beyond today's early adopter base.

Prediction Markets Are Another Major Growth Engine

StoneX also highlighted Robinhood's prediction-markets business as a major source of future growth.

In the second quarter, Robinhood customers traded 13.6 billion event contracts, including more than 5 billion during the World Cup. The activity generated approximately $156 million in revenue, a 50% increase from the previous quarter.

The business has become significant enough to compete directly with Robinhood's traditional revenue streams.

Robinhood recently announced partnerships with Crypto.com and OG.com to expand its prediction-market infrastructure. The company will take equity stakes in both businesses and route selected event contracts through OG.com, while continuing to work with existing venues including Kalshi, ForecastEX and Rothera.

The timing is important because the NFL season is beginning, while the 2026 U.S. midterm elections are also approaching.

Robinhood expects both events to drive additional demand for prediction contracts, giving the business two major sources of potential volume during the coming months.

Related: Robinhood Expands Prediction Markets With Crypto.com and OG.com Ahead of NFL Season

Crypto Is No Longer Robinhood's Only Growth Story

Robinhood's latest financial results also explain why analysts are increasingly focusing on the company's diversification.

Second-quarter revenue increased 32% year over year to $1.31 billion, while cryptocurrency revenue declined 38%. Crypto consequently represented about 8% of net revenue, compared with 16% a year earlier, according to StoneX.

That does not necessarily mean Robinhood is moving away from crypto.

Instead, it highlights how quickly other businesses are growing.

Robinhood is building an ecosystem that combines brokerage services, crypto trading, blockchain infrastructure, prediction markets and other financial products. StoneX argues that the company has effectively been acquiring or building exchange and blockchain infrastructure with software like margins.

Related: Robinhood Chain’s TVL All Time High

Wall Street Is Raising Its Robinhood Outlook

StoneX is not the only investment firm becoming more optimistic about Robinhood.

Bernstein recently maintained an Outperform rating and $160 price target, which implies roughly 31% upside from Tuesday's closing price. Other analysts have also raised their targets as Robinhood's prediction markets, blockchain infrastructure and broader financial platform gain traction.

The growing analyst interest reflects a change in how Robinhood is being valued.

Rather than treating the company primarily as a retail trading platform whose performance depends heavily on market activity, analysts are increasingly examining its newer businesses as potential recurring growth engines.

Can Robinhood Chain Deliver the Growth StoneX Expects?

The biggest question surrounding the $170 target is whether Robinhood can turn early blockchain activity into sustainable revenue.

Robinhood Chain has already generated significant fees and trading volume, but a large portion of that activity has come from speculative markets and memecoins. The network's ability to attract tokenized stocks, real-world assets and eventually Robinhood's own retail customers will be important for determining whether today's activity can translate into longer-term growth.

Prediction markets face a different challenge. Their rapid growth demonstrates strong demand, but Robinhood will need to maintain that momentum after major sporting events and elections pass.

For now, however, StoneX believes the combination of these businesses gives Robinhood a substantially broader growth profile.

With Robinhood Chain scaling, prediction markets accelerating and the company's traditional brokerage operations continuing to expand, the $170 price target reflects a view that Robinhood is becoming more than a retail trading app.

The market will now be watching whether those newer businesses can turn their early momentum into sustainable earnings growth.