Kalshi, one of the fast-growing prediction market platforms that allows users to wager on the outcomes of real-world events, has reportedly acquired $1 billion in new funding at a valuation of $11 billion. This, according to recent media reports that referenced a source claiming to be familiar with the transaction. Notably, the funding round has come only 2 months after Kalshi had finalized a $300 million round at a $5 billion valuation, highlighting the investor demand for the company as prediction markets continue to gain popularity.
The funding round is said to have been led by existing investors Sequoia and CapitalG, Alphabet’s growth fund. They have been joined by various other investors such as Andreessen Horowitz, Paradigm, Anthos Capital, as well as Neo.
Kalshi’s ascent comes in an environment of growing competition with its closest industry rival, Polymarket, which had been reported this past month to be in discussions for a potential fundraise that may value it anywhere between $12 billion and $15 billion, only a few weeks following the close of a $1 billion round at a pre-money valuation of $8 billion.
The two leading prediction markets have been at the center of a solid year for prediction markets, boosted by rising political involvement and considerable trading activity.
Kalshi and Polymarket have increased their overall visibility in the past year after letting users place wagers on the US presidential election.
Their reputation and overall credibility seems to have been boosted when markets on Kalshi and Polymarket accurately anticipated the outcome of New York City’s mayoral race this past month.
Kalshi even posted up live election odds across New York subway areas, bringing prediction markets into the everyday commutes of consumers and creating more brand awareness in the process.
Kalshi reportedly serves users in over 140 different countries, providing markets on a range of topics / global events such as Time’s 2025 Person of the Year and the anticipated Rotten Tomatoes score for certain production films to longer-timeframe wagers like the upcoming US presidential elections.
Kalshi had in October this year topped $50 billion in yearly trading volume, a significant increase from only about $300 million in the past year, according to a report from The New York Times.
The firm has been established by ex- hedge fund professionals Tarek Mansour and Luana Lopes Lara, who had been studying computer science and math at MIT.
Kalshi has also dealt with regulatory obstacles, as prediction markets are at the blurring intersection of finance and gambling.
It is worth noting that Kalshi market a win after filing a lawsuit against the Commodity Futures Trading Commission (CFTC), and then managed to obtain the right to operate legally in the United States.
But it is still in disputes with various State regulators who understandably still consider the platform as being essentially a gambling service.
Kalshi competitor Polymarket has been banned from catering to US clients since 2022 after a major CFTC settlement. Earlier this year, the firm acquired a derivatives platform and clearinghouse, potentially marking a move that could allow it to re-enter the fast-growing US market.