Key Points
- Kalshi secured more than $1 billion in fresh capital through a funding round spearheaded by Coatue Management, elevating its valuation to $22 billion within months.
- The platform’s annualized revenue has reached $1.5 billion, while February saw trading activity surpass $10 billion.
- Arizona prosecutors have filed criminal charges against Kalshi, alleging the operation of an unlicensed gambling enterprise.
- The Ninth Circuit Court of Appeals in Nevada has enabled state authorities to proceed with restrictions on Kalshi’s activities.
- The company has identified and sanctioned users for insider trading violations, including an individual associated with content creator MrBeast.
Prediction market operator Kalshi has completed a funding round exceeding $1 billion, elevating the company’s valuation to $22 billion. Investment management firm Coatue Management spearheaded the capital raise, as reported by Bloomberg and The Wall Street Journal.
The valuation represents a twofold increase from December 2025, when Kalshi closed a $1 billion round at an $11 billion assessment. Paradigm led that previous investment, with participation from Sequoia Capital, Andreessen Horowitz, ARK Invest, and CapitalG, the venture arm of Alphabet.
Kalshi emerged in 2018 through the efforts of co-founders Tarek Mansour and Luana Lopes Lara. The platform functions as a regulated financial exchange under Commodity Futures Trading Commission oversight, establishing itself as the first regulated prediction market exchange operating on American soil.
The exchange enables participants to trade contracts linked to real-world events spanning diverse categories — electoral contests, commodity pricing, and even the potential confirmation of extraterrestrial life. The user ecosystem encompasses retail traders, institutional market-making firms, and corporations employing the platform for outcome-based risk management.
February trading volume on Kalshi exceeded $10 billion. This figure represents approximately twelve times the volume registered half a year prior, based on KalshiData metrics. Annual revenue projections for the company currently stand at $1.5 billion.
Expansion on the institutional side of the business has fueled investor enthusiasm for the latest funding round, according to a source with knowledge of the situation mentioned by the Wall Street Journal.
Polymarket, the primary competitor, has demonstrated comparable growth momentum while maintaining operations predominantly beyond U.S. borders. Recent valuations for both platforms have converged near the $20 billion mark.
Regulatory Challenges Escalate in Multiple Jurisdictions
Despite substantial growth metrics, Kalshi confronts significant legal obstacles. Arizona authorities filed 20 criminal counts against the platform this week, alleging operation of an unauthorized gambling enterprise and provision of election wagering within state boundaries. Kalshi has characterized the state-level prosecution as “seriously flawed.”
Thursday brought a setback when the Ninth Circuit Court of Appeals rejected Kalshi’s petition to prevent an anticipated temporary restraining order in Nevada. The decision empowers state regulators to implement operational restrictions against the platform.
Kalshi has initiated litigation against several states attempting to impose similar prohibitions. The company maintains its position under federal CFTC jurisdiction exempts it from state gambling statutes. More than a dozen state-level proceedings are currently in progress nationwide.
Trading Violations Draw Additional Attention
Last month, Kalshi disclosed the identification and penalization of two users engaged in insider trading activities. One penalized individual maintained editorial connections to MrBeast, the widely followed social media influencer.
The platform also revealed approximately 200 insider trading investigations, with over a dozen cases currently active.
Kalshi representatives declined to provide statements regarding the new funding round when approached by media organizations.
