Financing boost propels Kalshi's valuation to $2 billion after $185 million capital infusion.
In the dynamic world of prediction markets, two major players, Kalshi and Polymarket, are making waves. After Polymarket's return to the US market following the acquisition of a CFTC license through QCEX, the competition between these two platforms is now closely matched.
Kalshi, a federally regulated exchange under the Commodity Futures Trading Commission (CFTC), and Polymarket, now CFTC-regulated with a temporary US ban due to licensing issues in the past, are both making significant strides.
Recently, both platforms have raised substantial capital, reflecting investor confidence. Kalshi secured $185 million at a valuation of about $2 billion, aiming to expand and become the leading financial market globally. Polymarket, on the other hand, secured $200 million near a $1 billion valuation, bolstering its position amid ongoing political and economic volatility.
However, both platforms have experienced a decline in user activity since the high volumes during the last U.S. presidential election period. Kalshi's daily active users dropped from around 400,000 on election night to approximately 27,000-32,000 by mid-2025, while Polymarket's declined even more sharply, from 300,000 to 5,000-10,000 daily active users.
Key distinctions between the two platforms include their regulatory status and operational currency. Kalshi, as a CFTC-regulated exchange, uses US dollars, emphasizing compliance. In contrast, Polymarket operates on the blockchain, primarily using the cryptocurrency USDC, though now with a regulated US presence.
Kalshi's regulatory status brings some protections but also limitations, while Polymarket’s blockchain model offers a different set of trade-offs. Recognising the mission as a key attraction, co-founder and CEO Tarek Mansour stated that employees are drawn to Kalshi not just for its financial position.
Despite these advancements, Kalshi faced a regulatory setback when a federal judge denied its motion against Maryland's sports betting regulators, underscoring ongoing regulatory challenges for prediction markets. The sector is facing calls for more stringent state-level regulation, given concerns that these platforms function similarly to sports betting without adequate oversight.
In summary, the rivalry between Kalshi and Polymarket has intensified with both firms now operating in the US under CFTC regulation, bolstered by substantial capital raises. However, both are grappling with diminished user engagement post-election hype, regulatory scrutiny, and debate over consumer risks in the prediction market sector.
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- In the realm of prediction markets, technology plays a crucial role in the operations of both Kalshi and Polymarket, as they leverage advanced systems to facilitate sports betting, investing, and finance, thereby streamlining business processes.
- The financial sector is closely monitoring the growth of these platforms as they continue to raise significant capital, with Kalshi securing $185 million and Polymarket securing $200 million, signaling confidence from investors in their future financial success.
- Despite the regulatory challenges faced by both Kalshi and Polymarket, such as the recent denial of a motion against sports betting regulators in Maryland, they continue to invest in technology and expand their businesses, underscoring their commitment to navigating the complexities of the financial industry.
