Rounds of funding for prediction market sites Kalshi and Polymarket value the two platforms at $2 billion and $1 billion, respectively.
Kalshi raised $185 million in its latest round of Series C funding, putting the company’s value at $2 billion. Polymarket is also close to raising $200 million in its latest round of funding, putting the platform’s value at just over $1 billion.
Kalshi CEO Tarek Mansour posted the news on X, commenting, “I’m excited to announce our $185M Series C valuing Kalshi at $2B. The round was led by Paradigm with participation from Sequoia, Multicoin, Peng Zhao, Neo, and Bond Capital.”
Paradigm, the leading investor, is a crypto-focused venture capital firm co-founded by Matt Huang, a former partner at Sequoia Capital and Fred Ehrsam, co-founder of Coinbase.
Polymarket Backed By Peter Thiel and Elon Musk
Polymarket’s round of funding has been backed by billionaire Peter Thiel, a co-founder of PayPal, along with Elon Musk. The platform also announced a partnership with Musk through the social media platform X earlier this month.
The announcement came after Kalshi had prematurely announced that it was partnering with Musk’s AI venture xAI. A post on X denied any deal had taken place and Kalshi was forced to retract the statement.
Thiel was previously the first outside investor in Facebook, buying a 10% share in the company for $500,000 in 2004. He has since cashed out his stake in the company for over $1 billion. The entrepreneur has also invested in SpaceX, Airbnb, and Stripe, as well as Polymarket through his Founders Fund.
Polymarket declares itself as the world’s biggest prediction markets site, but the higher valuation of Kalshi is a reflection of its potential to expand in the regulated US market.
Polymarket was fined $1.4 million for operating its prediction markets without a valid license issued by the Commodity Futures Trading Commission (CFTC). It is now geo-blocked in the US, but has faced legal scrutiny by the FBI over claims it continues to accept US users.
Kalshi Also Thriving Despite Legal Challenges
Kalshi has also faced legal pushback as it has expanded its operations into sports betting markets. The site started offering sports markets in January this year and was issued cease-and-desist letters by 7 states over claims that the markets are unlicensed sports betting.
Kalshi argues the CFTC oversees its actions, and so far has won battles in courts despite strong opposition. The valuation at $2 billion shows that investors have faith it will be able to ride out the court challenges and continue to expand.
The company was founded in 2018 by Tarek Mansour and Luana Lopes Lara, MIT classmates who envisioned using event-based contracts to hedge real-world uncertainties such as political outcomes or financial risks. The name Kalshi means everything in Arabic, reflecting the company’s high ambitions.
In his post noting the latest company valuation, Mansour stated, “People choose to work at Kalshi not because of the money we’ve raised, but because of our ambition: build the most important financial market on the planet.”
The company earned its status as a Designated Contract Market (DCM) from the CFTC in 2020, making it the first federally regulated exchange in the U.S. for outcome-based event contracts.
The successful rounds of funding for both companies reflect confidence that the popularity of the prediction markets will outweigh any regulatory challenges in the future.
Adam is an experienced writer with years of experience in the gambling industry. He has worked as a content writer and editor for five years on sites such as Oddschecker, CoinTelegraph and Gambling Industry News, bringing excellent knowledge of the world of sports betting and online gambling. Adam focuses on emerging stories in the ever changing landscape of betting in the US. Read the latest on prediction markets, changing legislation, and sweepstakes.
