KEY INSIGHTS
- Kalshi raised $1 billion in Series G funding at a $40 billion valuation with Sequoia and Wellington.
- The company is expanding into crypto perpetuals equity indexes and metals while sports remain its largest category.
- Kalshi is battling state gambling lawsuits as the courts ponder the federal government’s jurisdiction over event-based trading contracts.
Kalshi has closed a Series G funding round of $1 billion at a valuation of $40 billion that was led by Sequoia Capital and Wellington Management as Kalshi expands from its sports and election betting contracts to become a prediction market platform. This is an increase from its previous valuation of $22 billion in May 2026.
The new investment comes in a time when Kalshi is developing products in cryptocurrencies, equity indexes, metals, and perpetual futures. As Kalshi works towards being more successful with its financial products, it is facing legal questions about whether its contracts should be considered for federal financial regulation or state gambling.
Kalshi’s Series G Funding Reaches $40 Billion Valuation
The latest financing values Kalshi at nearly twice the $21 billion valuation reported for rival Polymarket in its most recent funding round. Polymarket’s financing was led by 1789 Capital, a venture capital firm associated with Donald Trump Jr.
Source: The Block
Kalshi’s new valuation also represents an increase of approximately 82% from the $22 billion valuation reported in May, when the company raised another $1 billion in a Coatue Management-led round. The latest financing follows that earlier transaction by just over five months.
Series G funding is being supported by Sequoia Capital and Wellington Management. According to funding documentation, other entities involved in this round include Baillie Gifford, Morgan Stanley Investment Management, Coatue Management, and Andreessen Horowitz. Some other entities that took part in this funding round include Tiger Global Management and Dragoneer Investment Group.
According to Tarek Mansour, who is the co-founder and CEO at Kalshi, the funding will enable the firm to develop those products that its clients have been demanding.
While the Series G funding is largely seen as possibly the last private financing for the firm before its initial public offering, Mansour declined to give a timeline on that front.
Expansion of Kalshi from Sports and Election Markets
Kalshi started operations in 2021 after more than four years of efforts to get approval from federal regulators.
Around 80% of the trading volume at Kalshi is associated with sports activities. However, the company is also developing markets tied to other categories, including cryptocurrency and commodities.
Mansour said the company’s revenue outside sports had exceeded $1 billion. He also reported that cryptocurrency-related activity was growing faster than sports, while commodities were growing faster than cryptocurrency.
Perpetual futures are derivatives which do not expire at any particular time and Kalshi has already launched their services in perpetual futures. They first launched cryptocurrency perpetuals and then after gaining the necessary approvals from the Commodity Futures Trading Commission (CFTC) they moved on to equity indexes and metals.
Perpetual futures, as opposed to futures contracts associated with a particular outcome of an event, give investors an opportunity to keep holding their positions without having to roll forward their contract to a new expiration date. Moreover, perpetual futures may be traded using leverage.
Legal Issues Related to Regulatory Status of Prediction Markets Still Exist
The growth of Kalshi occurs against the background of debates on how prediction markets should be regulated. While the company claims that its contracts are covered by federal law as financial instruments, its opponents say that contracts related to sports amount to gambling.
More than a dozen states have pursued legal action challenging the platforms. Appeals courts have issued differing decisions, and New Jersey has petitioned the U.S. Supreme Court to consider whether federal law prevents states from regulating sports-related event contracts. Nevada and Washington have also secured restrictions on such wagers within their borders.
Earlier in the week, Utah’s attorney general brought criminal charges against Kalshi and two senior executives, accusing the company of illegally promoting online gambling. The allegations add to the legal uncertainty surrounding the platform’s operations.
Mansour said Kalshi would comply with regulatory decisions, describing the company as operating under the CFTC’s authority. He also acknowledged that court rulings would determine the outcome of the disputes.
