News: Kalshi And Polymarket Are Both Unicorns
Kalshi raises $185 million at $2 billion valuation; Polymarket set to raise $200M at $1B valuation.
The two biggest prediction markets are reportedly both unicorns valued at more than a billion dollars after recent raises.
Kalshi raised $185 million at a valuation of $2 billion according to CEO Tarek Mansour:
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. 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. Today, we celebrate our team and community who have taken prediction markets mainstream and made Kalshi one of the fastest growing companies in America. What once felt impossible now looks inevitable.
More from the Wall Street Journal (paywall), which notes that the round will help Kalshi “integrate with more brokers.” Kalshi currently has integrations with Robinhood and WeBull. Kalshi raised last fall and was valued at $787 million.
At the same time, reports indicated that Polymarket was close to closing a round of $200 million that values the company at over a billion dollars. The news was first reported by The Information (paywall); here’s more from Reuters.
It’s difficult to believe both pieces of news coming within 24 hours is coincidental. Despite the fact that the companies don’t serve the same jurisdictions, they are generally viewed as rivals both by observers and the companies themselves. (Kalshi serves only the US; Polymarket stopped serving the US after a settlement with the Commodity Futures Trading Commission and offers its platform to an international audience.)
Polymarket is clearly the larger prediction market, both by trading volume and its addressable market. (Despite not being in the United States officially, there is clearly some cohort of Americans that trade on Polymarket with cryptocurrency and VPNs.) And Polymarket has intimated it has designs on returning to the US market under the Trump administration; whether that happens remains to be seen.
Kalshi features a massive upside as a legal offering in the US under the auspices of the CFTC. Kalshi was fairly small until winning a federal court case in 2024 allowing it to take bets on elections in the US; it saw more than a billion dollars in trades around the November elections. The platform has grown even more on the heels of launching sports event trading earlier this year.
Despite that upside, there are potential headwinds:
Kalshi faces an uncertain legal landscape. While its argument that it is legal in all 50 states has held so far in court, it is fighting against states on multiple fronts, and likely faces more legal challenges, including from tribal gaming interests.
While Kalshi has a first-mover advantage, that doesn’t guarantee success into perpetuity. The closer sports event trading moves toward legal clarity via Kalshi’s pushing of the envelope, the more likely it is that it starts facing real competition. Legal sports betting in all 50 states will attract all sorts of companies to the space, eventually.