Polymarket and Kalshi Aim Billions After Regulatory Approval

• Polymarket seeks a $9B value after new CFTC approval allows U.S. expansion.
• Kalshi nears a $5 billion valuation as August trading volumes reach $875 million.
• Both firms show rising growth as investors see prediction markets gaining trust.

Prediction-market platforms Polymarket and Kalshi are preparing for multibillion-dollar valuations as regulatory decisions, trading growth, and institutional capital reshape the sector. According to sources, Polymarket is exploring a valuation of up to $9 billion, while Kalshi is nearing $5 billion, and these figures reflect a surge from earlier rounds, highlighting a change in the regulatory landscape. 

Regulatory Shifts Reshape the Market

Polymarket, recently considered a deal valuing the company at $9 billion, just three months after raising funds to $1 billion in a round led by Peter Thiel’s Founders Fund. The Commodity Futures Trading Commission (CFTC) barred Polymarket from offering contracts in the United States in 2021.

However, earlier this year, the agency granted the platform approval to operate again, following its acquisition of QCX and a September CFTC no-action letter, which provided relief from certain reporting and recordkeeping requirements. Polymarket CEO Shayne Coplan stated that the decision effectively gives the platform “the green light to go live in the USA.” The move allows the exchange to relaunch legally and pursue further growth.

During the last U.S. election cycle, Polymarket processed more than $8 billion in wagers, outpacing sports betting giants like FanDuel, DraftKings, and Betfair in traffic. Sources reported that Polymarket is seeking fresh funding that could triple its June valuation, with one investor valuing the company at up to $10 billion.

Related: Polymarket Uses Chainlink Oracles to Boost Market Integrity

Kalshi Expands Amid Legal Tests

Meanwhile, Kalshi has neared a $5 billion valuation, following its June raise of $185 million, led by Paradigm, thus putting the firm at $2 billion. In August, Kalshi recorded $875 million in trading volume and its recent momentum stems partly from a 2024 court ruling allowing it to list political-event contracts. The CFTC appealed, but later dropped its challenge in May 2025, leaving Kalshi free to continue.

However, the platform faces legal scrutiny in Massachusetts, wherein Attorney General Andrea Joy Campbell filed a lawsuit on Friday, alleging that sports event contracts introduced in January 2025 violated state sports wagering laws requiring licenses. 

Campbell asked the court to block Kalshi from offering these markets in the state and sought monetary and other relief. The filing explained that Kalshi’s prediction markets, designed as binary options, function much like regulated sports betting platforms, drawing a comparison to FanDuel. 

The filing stated that Kalshi operates by accepting wagers on amateur and professional sporting events, offering them as sporting event contracts where money or valuation is risked on uncertain outcomes.   

According to market analyst Tarek Mansour, Kalshi had processed $441 million in trading volume since the NFL season kickoff. He wrote, “NFL Week 1 is equal to a US election,” capturing the scale of trading interest.

Competing Models and Investor Demand

On the whole, Polymarket and Kalshi operate with distinct approaches. While Polymarket runs on the Polygon network, settles trades in USDC, and allows pseudonymous access, Kalshi is a federally regulated U.S. exchange, requiring full KYC, and operates under the CFTC. 

While Polymarket has broader global coverage across politics, courts, and geopolitical events, Kalshi offers institutional legitimacy for the trading of event-based contracts and, therefore, subjects it to compliance-focused entities. However, the trading data of both shows symptoms of accelerating adoption, with valuation data affirming investor belief in event-based contracts as mainstream products.

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