Driven by legal developments and the market's growing interest in predictive trading, the US event contracts trading platform Kalshi announced the completion of a $185 million Series C funding round, with a post-money valuation of $2 billion. This round was led by Paradigm, with participation from Sequoia Capital, Multicoin, Bond Capital, Neo, and Citadel Securities CEO Zhao Peng.
This fundraising comes at a time when Kalshi has achieved a partial victory in its legal battle with the US Commodity Futures Trading Commission (CFTC) over political event contracts. The CFTC approved its new trading products related to the 2024 US presidential election results, opening new prospects for expanding its event contract product line. Kalshi thus positions itself as a more transparent and compliant choice compared to "grey" prediction platforms.
Despite progress at the federal level, Kalshi still faces regulatory challenges at the state level. For example, in April this year, the Maryland regulatory authority asked it to cease operations, and Kalshi subsequently filed a legal defense; it also recently opposed a court statement submitted by a tribal group, calling it "irrelevant".
Kalshi was founded in 2018 by Tarek Mansour and Luana Lopes Lara, allowing users to trade on the outcomes of real-world events such as weather, elections, and economic data. As investor interest in "event-driven financial instruments" rises, Kalshi has attracted capital attention.
Meanwhile, competitor platform Polymarket is also reported to be close to completing a $200 million funding round led by Founders Fund, with a post-money valuation exceeding $1 billion. Unlike Kalshi, Polymarket operates on a cryptocurrency system and does not serve US users, but its trading activity has significantly increased on topics such as Middle Eastern geopolitics and economic recession expectations.
It is noteworthy that earlier this year, the trading platform Robinhood also launched a prediction market feature, further validating the attractiveness of this track. Although compliance issues remain unresolved, platforms like Kalshi and Polymarket are becoming new high grounds targeted by both users and capital.
