Kalshi has announced a significant funding round, raising $1 billion led by Sequoia Capital and CapitalG. This investment propels the company's valuation to $11 billion, positioning it in a similar valuation bracket as its rival, Polymarket, which is reportedly seeking between $12 billion and $15 billion.
The latest funding round was spearheaded by Sequoia Capital and CapitalG. Notable previous investors, including Andreessen Horowitz, Paradigm, Anthos Capital, and Neo, did not participate in this particular round. This follows closely on the heels of Kalshi's October funding round, where it secured $300 million with participation from a16z and Paradigm, enabling its expansion into 140 countries.
The substantial capital infusion comes just one month after the October expansion. Kalshi has now successfully raised $1.3 billion in a short period, underscoring a strong investor interest in prediction markets, which experienced a surge in popularity during the 2024 election cycle.
Market Leadership and Functionality
Data from DefiLlama indicates that Kalshi and Polymarket have collectively generated over $17.4 billion in trading volume since September. Kalshi currently holds a dominant position, controlling 61.4% of this volume, reinforcing its status as the market leader. These platforms allow users to trade on the outcome of real-world events, encompassing a wide range of possibilities from election results to corporate earnings announcements.
Strategic Integrations and Market Competition
Both Kalshi and Polymarket have recently announced significant integrations. Kalshi has been added to Google Finance, building upon its existing integrations with platforms such as Robinhood, Elon Musk's xAI and Grok, and the Pyth Network. Polymarket has also secured partnerships with MetaMask, Google Finance, and Yahoo Finance, and is preparing for a full relaunch to U.S. residents later this month.
Polymarket had been operating without U.S. customers since 2022 due to regulatory challenges. However, it returned in Beta Mode earlier this month. The platform's re-entry into the American market is expected to intensify competition with Kalshi for trading volume and overall market share.