Kalshi Raises $185 Million Amid Regulatory Progress
Prediction market operator Kalshi secured $185 million in funding following a Series D investment round, new reports indicate. The investment values the company at a $2 billion valuation, signaling rising financial backing for the sector. The Wall Street Journal reported Wednesday that the round was led by cryptocurrency-focused investment firm Paradigm.
Additional backing came from prominent venture capital firms including Sequoia Capital and Multicoin Capital, alongside unspecified other investors. CEO and co-founder Tarek Mansour announced the funding will primarily be used to expand engineering talent, focusing especially on technology team growth. He also confirmed integration plans to reach more brokerage platforms beyond its current listings on Webull and Robinhood Markets.
Kalshi operates in direct competition with the prominent prediction market Polymarket. The technology startup was founded in 2018 by CEO Tarek Mansour and co-founder Luana Lopes Lara. Prior Series D disclosure reveals Kalshi previously raised cumulative capital of $156 million, bringing its new total funding to nearly $341 million.
Prediction markets are increasingly positioned as alternative mechanisms to conventional polling methods. Proponents assert these markets effectively aggregate widely dispersed information and participant expectations for accurate forecasting outcomes across diverse events.
Kalshi’s current funding comes at a time when its primary competitor, Polymarket, is also securing significant capital. Reports indicate Polymarket raised approximately $200 million at around a $1 billion valuation. Creating a key distinction between the two is Kalshi’s federal regulatory approval. Authorized by the Commodity Futures Trading Commission (CFTC), Kalshi can legally operate within United States financial markets—aegis Polymarket lacks.
Overshadowing Investor Confidence: Regulatory Hurdle Cleared
Kalshi’s latest funding round follows crucial regulatory developments that have reshaped its operating landscape. In September 2024, the US CFTC initiated legal appeal proceedings challenging a previous court ruling that had facilitated Kalshi’s deployment of political event prediction contracts.
The fundamental dispute revolved around whether these politically-focused contracts properly intersect federal commodities law regulations prohibiting certain forms of gambling. A significant turning point occurred in May 2025, when CFTC formally moved to dismiss its appeal against “United States v. Kalshi Corp.” An analyst described this action as clearing a central hurdle, effectively removing a major regulatory impediment.
The timing and resolution mark a pivotal moment for the prediction market sector. It potentially ushers in a framework for regulated political forecasting in the United States, enhancing perceived legitimacy and security for participants.
The November 2024 US presidential election provided a substantial test for both Kalshi and Polymarket, as platforms attracted considerable trading volume across political outcomes. This election cycle represented both commercial viability and a validation of the forecasting methodology by participants.
Kalshi’s product catalog spans diverse prediction topics across cryptocurrency prices, economic indicators, sporting events, and weather occurrences. Bloomberg Intelligence data suggests sports represents a core category for Kalshi, accounting for 79% of March and early April 2025 trading volume. Market analysis will continue to monitor whether these contracts follow the path charted by political markets following this regulatory decision.
Related: Kalshi Accepts Bitcoin Deposits to Attract Crypto-Native Users
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