Kalshi raises $1B at a $40B valuation to build a broader exchange
Wellington and Sequoia co-led the prediction-market company's Series G, nearly doubling its May valuation as it pushes into perpetual futures, indices and compute markets.
Kalshi has raised $1 billion in a Series G round at a $40 billion post-money valuation, the prediction-market company said on Thursday. Wellington and Sequoia co-led the round, and Kalshi plans to spend the money turning its event-contract business into a broader financial exchange.
The price nearly doubles the $22 billion valuation Kalshi set in May, when it raised another $1 billion in a round led by Coatue, Reuters reported. A year ago the company was valued at about $5 billion, according to CNBC.
Who is in the round
Alongside the two lead investors, Kalshi named ten co-investors: Baillie Gifford, Stripes, Andreessen Horowitz, Coatue, Layer Global, Morgan Stanley Investment Management, Sequoia Global Equities, CapitalG, Hudson River Trading and Balyasny Asset Management. Reuters, citing a person familiar with the matter, reported that Tiger Global Management and Dragoneer Investment Group also took part.
The list leans toward large asset managers and trading firms alongside venture investors. Chief executive Tarek Mansour told CNBC in June that Kalshi was considering going public, though not before 2027. It would join a busy pipeline of large private tech companies weighing listings, including Anthropic, which filed for its IPO this month. The round also lands in a week of large late-stage financings that included Bedrock Robotics' $600 million Series C and FuriosaAI's $620 million raise.
What the numbers show
Kalshi's own figures describe a business that has moved well past sports, the category that brought millions of users to the platform. The company says it now has more than $1 billion in annualized revenue from non-sports markets, and that annualized trading volume across the whole exchange exceeds $1 trillion. It reports more than 30 million accounts created and claims over 75% of prediction-market trading volume.
By segment, Kalshi says its commodities business is generating more than $100 million in annualized trading fees after three months, crypto trading volume has reached $140 billion annualized, and politics volume is above $8 billion annualized. Its international retail business, live in more than 140 countries for about a year, is approaching $100 million in annualized fees.
The fastest-growing line is perpetual futures, derivatives with no expiry date that let traders hold leveraged positions without rolling them over. Kalshi launched them in the US earlier this year after the Commodity Futures Trading Commission approved the products, starting with crypto and later adding equity indexes and metals, Reuters reported. The company says the business has reached $83 billion in trading volume and more than 500,000 traders since launch.
Institutions are a growing share of activity. About 500 entities were active on Kalshi in September, and entities other than market makers accounted for roughly 25% of total trading volume, the company said.
Where the money goes
Kalshi says it will use the capital to launch indices, single-stock perpetual futures and markets on the price of computing power, and CNBC reported the company also plans leveraged event contracts. The index work builds on a partnership with S&P to construct indices from prediction-market data. Kalshi also plans to hire for institutional sales and distribution aimed at hedge funds and proprietary trading firms, and to expand internationally with a focus on Latin America and Europe.
That strategy puts Kalshi in more direct competition with established exchange operators such as CME Group and NYSE owner Intercontinental Exchange, according to Reuters. Its distribution partners already include Interactive Brokers, Nasdaq, Stripe, PayPal, Block, Public.com and Wealthsimple, among others the company listed.
The legal fight in the background
The announcement came a day after Utah escalated its dispute with the company. On October 28, Utah Attorney General Derek Brown filed 14 criminal counts against KalshiEX and co-founders Mansour and Luana Lopes Lara, alleging the company let an undercover state agent place sports wagers from inside Utah in September. The charges include a second-degree felony for a pattern of unlawful activity, 12 third-degree felony counts of online gambling promotion and one misdemeanor. Reuters reported the filing came a day after the CFTC sued to stop Utah from enforcing its anti-gambling laws against Kalshi.
The underlying question is whether states or the federal government regulate sports event contracts. Two federal appeals courts ruled this year that states have that power, while a third sided with the federal view, CNBC reported, a split that is likely to be settled by the Supreme Court.
Kalshi has overtaken rival Polymarket in market share over the past year, according to Dune Analytics data cited by Reuters, while Polymarket has faced delays launching its US platform. The next test is whether the non-sports products keep growing at the pace Kalshi reported this week while the dispute over sports contracts works its way toward the Supreme Court.
