Recently, Kalshi announced the completion of a US$185 million Series C financing led by Paradigm, with its valuation jumping to US$2 billion; at the same time, Polymarket is also preparing to complete a round of financing of nearly US$200 million, with a valuation exceeding US$1 billion.
The frequent news of financing in the prediction platform track inevitably reminds people of the undercurrent of competition and tension between platforms. A showdown over the pricing power of future information is quietly unfolding.
The love-hate relationship of prediction markets
Kalshi was founded in 2020 and is headquartered in New York. It is currently the only legal prediction market platform approved by the U.S. Commodity Futures Trading Commission (CFTC). Its investors include Y Combinator, former Charles Schwab CEO David Pottruck, and crypto venture capital firm Paradigm. The latest round of financing has valued the company at $1 billion.
Polymarket represents the decentralized prediction market. The platform allows users to use the crypto stablecoin USDC to conduct event prediction transactions on the blockchain, supports on-chain settlement, and has strong liquidity. Its investment camp is also luxurious, including Founders Fund, Polychain Capital, Naval Ravikant, Balaji Srinivasan, etc. The new round of financing is expected to be US$200 million, and the pre-financing valuation is also close to US$1 billion, led by Founders Fund.
In June this year, Polymarket announced a partnership with X, a social platform led by Musk, to combine its prediction market data with Grok, an AI tool launched by xAI, to create a real-time prediction information flow. Previously, Kalshi had taken the lead in negotiating similar cooperation with X, and even officially announced it, but the cooperation was withdrawn in less than 24 hours.
It is generally believed that this lightning turn has a strong political meaning behind it - Trumps eldest son Donald Trump Jr. is Kalshis senior adviser. Musks social media conflict with Trump is at its peak. Xs abandonment of Kalshi and embrace of Polymarket, which has not yet complied with the regulations, is interpreted as a strategic response to his political inclinations, and also reflects Musks dissatisfaction with traditional supervision.
Related reading: X cooperates with Polymarket, Musk is one step closer to the App for Everything
Recently, crypto investor Tom Schmidt revealed that Kalshi may have privately coordinated with former NFL player Antonio Brown (AB) to launch an organized public opinion attack on Polymarket.
In a set of screenshots disclosed by Pirate Wires, Keaton, an employee of Kalshis growth department, was exposed to have sent a private message to AB, asking him to forward it with the text This guy looks guilty to insinuate that Polymarket CEO Coplan was suspected of committing a crime. Subsequently, AB followed the instructions and posted relevant tweets, confirming the fact that Kalshis organization manipulated public opinion and launched a smear campaign through social influencers.
In addition to Antonio Brown, Pirate Wires also found that many KOLs with large numbers of followers also posted negative content after the FBI raid on Polymarket CEO. For example, the meme account Clown World posted a tweet one day after the FBI raid, mocking Polymarket CEO Coplan as the illegal gambling version of SBF and having a paid partnership with Kalshi. The account also posted content related to Kalshi many times during the election.
Miami influencer Arynne Wexler posted a video emphasizing that Polymarket is illegal in the United States, repeatedly recommending Kalshi and reminding viewers to choose a compliant platform. Relevant screenshots show that Arynne Wexler had previously cooperated with Kalshi privately.
Kalshi VS Polymarket, who is better?
Financing background: highly sought after by first-tier capital
Both Kalshi and Polymarket have been favored by the capital market, with top VCs and industry figures betting on them, showing that the prediction track is changing from niche speculation to next stop infrastructure.
Kalshi started as a Y Combinator winter incubation project in 2019, and then completed a $30 million Series A financing led by Sequoia Capital in February 2021, with the companys valuation reaching $120 million. SV Angel, Charles Schwab, chairman of Charles Schwab, and Henry Kravis, co-founder of KKR, and other heavyweights were all on the list. In October 2024, Kalshi won another $50 million in financing, with Sequoia Capital, Mantis VC, Neo and other well-known institutions following suit. The funds will be used to expand the event contract category and enhance the platforms functions. On June 26, 2025, Kalshi completed a $185 million Series C financing led by Paradigm at a valuation of $2 billion.
Polymarkets financing path is more Web3-like: In 2020, the year of its founding, it won a $4 million seed round led by Polychain, and its angel investment lineup included Web3 OG-level figures such as Balaji (former a16z partner, Coinbase CTO), Jack Herrick (founder of wikiHow), and Robert Leshner (founder of Compound). In 2022, it won a $25 million Series A round led by General Catalyst, and Airbnb co-founder Joe Gebbia and Polychain bet again. In May 2024, Polymarket completed a $45 million Series B financing led by Founders Fund under Peter Thiel (co-founder of PayPal and Palantir), and Ethereum founder Vitalik also participated in the investment. It is currently preparing for a new round of $200 million in financing, and its valuation is expected to exceed the $1 billion mark.
It is worth noting that behind Polymarket is not only the deep bet of traditional crypto capital, but also the recognition of Silicon Valley legend Peter Thiel. Thiel led the B round of financing for Polymarket through his Founders Fund, which is also one of the early supporters of Musk X. Kalshi has received endorsements from members of the Trump family. At a time when the election market has caused regulatory controversy, the indirect support of Kalshi by the Trump camp has been interpreted by the market as a policy signal many times. In this highly politicized track, the game between capital and power has long been more than just predicting the track itself.
Operational Mechanism: Centralization vs Decentralization
The core difference between Polymarket and Kalshi in the way their platforms operate is mainly reflected in decentralization vs. centralization.
Kalshi adheres to the centralized route and adopts the traditional centralized order book structure. The platform is both a matchmaker and a fund custodian. All transaction matching, result sources and settlement paths are completed in a closed loop within its platform. The trading experience is closer to the U.S. stock options market, and the entire set of logic is more conducive to institutional participation and regulatory access.
Polymarket completely embraces the decentralized narrative - AMM market-making mechanism, smart contract full-chain settlement, oracle determines the source of results, no need for trust center, no need for real-name registration, wallet is transaction. The platform has engraved the characteristics of freedom, fairness, and anti-censorship into the code logic, which is closer to the decentralization of the crypto community.
Supervision: Compliance first vs. regulatory red lines
The regulatory gray area of the prediction market is no secret, and the different fates of Kalshi and Polymarket in this gray area have further revealed the pros and cons of the centralized and decentralized routes.
Kalshi broke through the layers of regulatory barriers and became an officially recognized prediction market: In June 2023, the election contract attracted the attention of the U.S. Commodity Futures Trading Commission (CFTC). On June 12, Kalshi self-certified to the regulator, and on the 23rd, the CFTC initiated a formal review. On September 22, it was finally rejected for involving illegal gambling. However, Kalshi did not give up, and subsequently launched a protracted tug-of-war with the CFTC in the Washington Circuit Court of Appeals. It finally won in October 2024 and became the first prediction platform in the United States to obtain legalization of election contracts.
In sharp contrast, Polymarket is being sieged by regulators: as early as 2022, it was sued by the CFTC for providing unregistered over-the-counter binary options contracts, paid a fine of $1.4 million and promised to withdraw from the US market. However, according to on-chain access data, about 25% of access traffic still comes from US users, and bypassing restrictions through VPNs has become the norm. In November 2024, after the US election, Polymarket once again detonated the regulatory powder keg: the US Department of Justice launched an investigation, and the FBI raided the home of its founder Shayne Coplan and seized his electronic devices, accusing him of possibly manipulating the platform results to influence public opinion in the election and guide US users to participate in transactions. To date, Polymarket is still in the status of an illegal platform identified by the CFTC, and the shadow of regulation lingers.
Influence: Polymarket breaks the circle and leads
If Kalshi wins in rule-making, then Polymarket wins in breaking the circle of voice.
In the 2024 US election, Polymarket accurately predicted Trumps victory in advance, becoming a representative platform for slapping polls in the face. Bloomberg Terminal connected its odds data to the system, and mainstream media such as The New York Times, The Economist, and The Wall Street Journal collectively cited on-chain prediction data for the first time, breaking the Web2 public opinion barrier. Even Trump himself personally named Polymarket at the rally, allowing its influence to penetrate from the chain to public opinion across the United States.
In terms of scale, Polymarket has long been leading. The platforms current TVL has reached 113 million US dollars, exceeding the sum of the top ten platforms in the entire track; the cumulative trading volume of the US election market in 2024 exceeded 3 billion US dollars, and the betting amount exceeded 4 billion US dollars. Kalshis total trading volume in the election market in the same period was 875 million US dollars, and the betting amount was about 230 million US dollars. Whether it is user participation, transaction depth or market feedback heat, Polymarket is a well-deserved phenomenal platform in the current prediction track.
Summarize
Whether it is Kalshi, which takes the centralized compliance path, or Polymarket, which adheres to the spirit of decentralized autonomy, both represent different answers to the future pricing power in the information age. Whether the two paths will eventually lead to the same destination, it still needs time to test. But what is certain is that the prediction market is moving from the edge to the center. It is no longer just a speculative game for a few people, but has become a new way to explain the world. Who will rise and fall is worth betting on.
