Prediction Markets Hurt Fintech User Churn: Inversion CEO
Venture capital firm founder Santiago Roel Santos warns that mainstream finance platforms like Robinhood, Coinbase, and Gemini are moving too quickly to integrate prediction markets, prioritizing short-term gains over long-term user retention. He asserts that “casino-like” offerings drive up user churn by increasing the likelihood of account liquidation, reducing the potential lifetime value of users. While recognizing the utility of prediction markets, Santos argues such features distract from the core mission of providing accessible financial services and building lasting relationships as users mature. He advocates for financial apps to focus on durable, traditional products like credit cards, insurance, and savings tools, which foster long-term engagement and stability. Santos concludes that managing churn risk is vital for platforms aiming to achieve sustainable growth and strong competitive advantages.
