Kalshi raised $1 billion in a round co-led by Sequoia Capital and Wellington Management, lifting the company's valuation to $40 billion. That marks an 82% increase since May, when it secured $1 billion at a $22 billion valuation. Total funding now stands at around $3.6 billion.
Tiger Global Management and Dragoneer Investment Group also participated. The prediction market operator is expanding into traditional financial trading while facing pressure from state regulators over its core business.
Utah's attorney general filed criminal charges this month against Kalshi, CEO Tarek Mansour and executive Luana Lopes Lara, alleging the platform illegally promotes online gambling. Authorities say an undercover agent was able to place sports wagers through the service.
The CFTC sued to prevent Utah from applying gambling laws to Kalshi. Attorney General Derek Brown called the company 'the manager of a back-alley gambling den'. New York and Nevada are also moving to restrict its operations. Three Native American tribes filed lawsuits accusing the platform of violating tribal sovereignty through sports betting on reservations. The Ninth Circuit ruled against Kalshi in one such case last month.
Kalshi maintains its contracts are financial swaps regulated by the CFTC. Users take 'yes' or 'no' positions on event outcomes. Sports-related trading accounts for up to 70% of an estimated $4 billion in annualised revenue as of July. The company attributed increased activity to the FIFA World Cup, NFL games and U.S. midterm elections.
Dune Analytics data shows Kalshi overtook rival Polymarket in market share over the past year. Polymarket faces delays launching its U.S. platform and a CFTC investigation.
Kalshi received CFTC approval for perpetual futures trading in 2026. It launched cryptocurrency contracts first, then expanded into equity indexes and metals. These derivatives have no expiration date and can involve substantial leverage. The company aims to compete with CME Group and Intercontinental Exchange, which owns the New York Stock Exchange.
Donald Trump Jr., who joined as a strategic advisor last year, holds an equity stake in the company.
