Forecast platforms Kalshi and Polymarket are reportedly exploring recent rounds of fundraising that could value the companies at around $20 billion each, roughly double the latest valuations.
Both platforms have held preliminary talks with potential investors about raising recent capital at an increased valuation, reports the Wall Street Journal reported on Friday, citing people familiar with the matter. The report indicates that the negotiations are at an early stage and may not result in a transaction being concluded or the target valuation secured.
Kalshi currently operates in the United States and offers markets that allow users to bet on outcomes related to sports, politics, the economy and cultural events. The company was last valued at around $11 billion in December, when it raised $1 billion from investors including Paradigm and Sequoia Capital.
Founded in 2018 by Tarek Mansour and Luana Lopes Lara, Kalshi received approval from the U.S. Commodity Futures Trading Commission in 2020 to operate as a regulated exchange for event-based markets. Since then, the platform has grown rapidly and recently surpassed $1 billion in revenue, with some estimates putting the number closer to $1.5 billion.
Related: Kalshi and Polymarket face trading halt in Nevada following court rulings
Polymarket plans to introduce the product to the US market later this year
Polymarket, launched in 2020 by Shayne Coplan, remains unavailable to U.S. users without a virtual private network, but plans to roll out a regulated domestic version of its platform later this year. In October, the company was valued at about $9 billion after Intercontinental Exchange, owner of the New York Stock Exchange, agreed to invest up to $2 billion.
Both platforms have attracted the attention of lawmakers and regulators. US Democratic lawmakers are working on drafting legislation to regulate prediction markets after bets on the timing of US and Israeli attacks on Iran raised concerns about insider trading, Cointelegraph reported.
Sen. Chris Murphy alleged that people close to the White House may have used prior knowledge of the attack to place bets, noting that several Polymarket accounts reportedly made about $1 million betting just hours before the report of the Tehran explosions.
Related: Founder Kalshi provides an update on the separation of the Khamenei market in Iran
Polymarket faces suspicions of insider trading
Polymarket faced multiple insider trading allegations after several traders placed bets at an unusually good time for essential events. A miniature group of cryptocurrency wallets recently placed over $1.2 million in bets in the market related to the onchain investigation into DeFi platform Axiom shortly before blockchain researcher ZachXBT published claims of insider trading in connection with the project.
Last month, in a separate incident, another Polymarket account made about $400,000 after placing a enormous bet on the capture of Venezuelan President Nicolás Maduro shortly before the news became public, further raising questions about whether some traders had advance information.
Warehouse: Bitcoin Could Take 7 Years to Upgrade to a Post-Quantum Version – BIP-360 Contributor
