Prediction market platforms Kalshi and Polymarket are reportedly looking for fresh fundraising rounds that could value the companies at around $20 billion each, roughly double their recent valuations.
The Wall Street Journal reported on Friday, citing people familiar with the matter, that the two platforms have held preliminary talks with potential investors about raising fresh capital at a higher price. The report said negotiations are still at an early stage and may not result in a deal or secure a target price.
Kalshi currently operates in the United States and offers markets that allow users to bet on outcomes related to sports, politics, economy and cultural events. The company was last valued at about $11 billion in December after 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 US Commodity Futures Trading Commission in 2020 to operate as a regulated exchange for event-based markets. The platform has since expanded rapidly and recently surpassed the $1 billion revenue run rate, with some estimates putting the number closer to $1.5 billion.
Related: After court rulings in Nevada, Kalshi, the polymarket is facing a trading halt.
Polymarket plans a US launch later this year.
Polymarket, launched in 2020 by Shayne Coplan, is inaccessible to US users without a virtual private network but plans to introduce a regular home version of its platform later this year. The company was valued at about $9 billion in October after New York Stock Exchange owner Intercontinental Exchange agreed to invest up to $2 billion.
Both platforms have attracted the attention of lawmakers and regulators. As Cointelegraph reported, US Democratic lawmakers are pushing legislation to regulate futures markets after questionable timing of the US and Israeli attacks on Iran, which raised concerns about insider trading.
Senator Chris Murphy alleged that people close to the White House may have used advance information about the attack to bet, noting that several polymarket accounts reportedly made $1 million in the hours before the explosions were reported in Tehran.
Related: Kulshi founders provide updates on Khamenei’s market carve-up in Iran.
The polymarket faces suspicions of insider trading.
The polymarket faced numerous insider trading allegations after several traders placed unusually well-timed bets on major events. A small group of crypto wallets recently bet more than $1.2 million on the market linked to the Onchain investigation into DeFi platform Axiom, shortly before blockchain investigator ZachXBT published claims about insider trading linked to the project.
In a separate incident last month, another Polymarket account reportedly made nearly $400,000 after placing a large bet on the arrest of Venezuelan President Nicolas Maduro shortly before the news broke, further raising questions about whether some traders had prior information.
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