Prediction market Kalshi has achieved unicorn status, raising $185 million at a $2 billion valuation, just a day after Polymarket also hit the $1 billion valuation mark with a fundraise of its own.
Kalshi’s Series C funding round — first reported by The Wall Street Journal — was led by Paradigm Operations. Other participants include Sequoia Capital, Multicoin, Neo, Bond Capital, and Citadel Securities CEO Peng Zhao.
It’s Kalshi’s first equity fundraise since 2022, when the business did not yet offer contracts on either sports or elections. At that time, the business raised $30 million and was valued at $787 million.
Fundraise leader Paradigm mostly invests in cryptocurrencies and businesses related to the crypto sector. It has invested in businesses including Coinbase and OpenSea, as well as failed cryptocurrency exchange FTX.
In a post on social media site X, Kalshi co-founder Tarek Mansour said: “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.”
Kalshi looks for more broker partners
According to the Journal, the funds will help Kalshi “integrate with more brokers.” Kalshi already has partnerships with stock trading businesses Robinhood and Webull, and Mansour has said that he wants Kalshi contracts to be available from most 401(k) providers by the end of 2026. Charles Schwab, who founded and gives his name to one of the largest retirement plan providers in the country, invested in Kalshi in the company’s 2022 funding round.
The new investors will be bullish on Kalshi’s ability to continue to grow. While the platform’s trading volume is typically in the tens of millions per day, InGame analysis last month suggested its fee revenue was only $15 million over the 90 days to May 26.
Whether the business can live up to its new unicorn-tier valuation may depend in part on the result of a number of court cases related to Kalshi’s sports event contracts. States including New Jersey, Nevada, and Maryland have argued that these contracts — where customers can stake money on a sporting outcome — are an unlicensed form of sports betting. Kalshi, which is regulated by the Commodity Futures and Trading Commission (CFTC), argues that they are legitimate financial products.
Polymarket valued at $1 billion
The announcement came only a day after The Information revealed that fellow prediction market Polymarket raised $200 million at a valuation of $1 billion.
Polymarket’s funding round was led by Founders Fund, the venture capital vehicle of multi-billionaire Peter Thiel. Thiel was a co-founder of Palantir — which he remains the chair of — and PayPal, and has invested in businesses including Facebook, Airbnb, and Stripe.
Unlike Kalshi, Polymarket is not regulated by the CFTC — or any other U.S. authority — and thus is not allowed to accept customers from the U.S., though the business was investigated by the Department of Justice last year over claims that U.S. customers were still using the platform, according to Bloomberg.
The lower valuation comes despite higher trading volumes on Polymarket, according to the Polymarket Analytics platform, which is not affiliated with the exchange itself. That difference suggests investors believe Kalshi has stronger growth opportunities or lower downside risks — perhaps due to its CFTC-registered status or its partnerships with brokers — or that it can more efficiently turn trading volumes into profits.
