TLDRs;
- Polymarket is reportedly seeking a $12–15 billion valuation in new funding rounds, sources say.
- ICE’s recent $2B investment lifted its valuation to $8 billion earlier this month.
- Rival Kalshi hit a $5B valuation after new funding from Sequoia and Andreessen Horowitz.
- Despite soaring activity, Polymarket’s revenue model and regulatory clarity remain uncertain.
Crypto prediction platform Polymarket is in early talks with investors to raise capital at a valuation between US$12 billion and US$15 billion, according to sources familiar with the discussions.
The ambitious target marks a tenfold jump from its US$1 billion valuation in June, when Founders Fund led a US$200 million investment round. The surge underscores how prediction markets are fast becoming a frontier for speculation, data insight, and decentralized finance adoption.
Earlier this month, Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, committed up to US$2 billion in funding for Polymarket, reportedly valuing it at around US$8 billion. The ICE deal appears to have ignited renewed investor confidence and sent rival platforms scrambling to capture similar attention.
Rival Kalshi Joins the Billion-Dollar Club
Polymarket’s main competitor, Kalshi, is also riding the funding wave. In mid-October, Kalshi secured US$300 million at a US$5 billion valuation, up sharply from US$2 billion just three months earlier.
The round was co-led by Sequoia Capital and Andreessen Horowitz, with participation from Paradigm Ventures, CapitalG, and Coinbase Ventures. Kalshi’s platform, which allows users across 140 countries to place bets on real-world events, expects to hit US$50 billion in annualized trading volume, up from just US$300 million the previous year.
The competition between Polymarket and Kalshi has transformed the prediction sector into a multi-billion-dollar arms race, as both platforms attract institutional partners and mainstream recognition.
Record-Breaking Volumes, Cloudy Economics
According to data cited by Bloomberg, both Polymarket and Kalshi have seen weekly trading volumes soar past US$2 billion, surpassing previous highs recorded during the last U.S. presidential election.
However, questions linger about Polymarket’s underlying revenue model. Despite massive growth, the platform does not charge traditional trading fees. Users instead pay blockchain gas fees and relayer costs, the latter being third-party services that process transactions on users’ behalf.
While liquidity providers (LPs) earn profits through bid-ask spreads, Polymarket itself earns relatively little from this activity. The absence of a clear “take rate” makes it difficult for analysts to assess whether the company’s meteoric valuation is grounded in sustainable revenue or speculative momentum.
Regulatory Uncertainty Looms Over Event Markets
The U.S. Commodity Futures Trading Commission (CFTC) has so far taken a cautious stance toward prediction markets, granting limited “no-action relief” to specific entities such as QCX LLC and the Chicago Mercantile Exchange (CME).
Yet, state gaming regulators have challenged federal oversight in court, arguing that event markets involving sports or political outcomes fall under state-level jurisdiction. This tug-of-war has left platforms like Polymarket navigating a legal gray zone.
Amid this uncertainty, regtech vendors see a growing opportunity to supply compliance, surveillance, and insider-trading detection tools tailored to event-driven markets. As ICE begins distributing Polymarket data to thousands of financial institutions, and as X (formerly Twitter) names Polymarket its official prediction partner, the demand for regulatory clarity and oversight will only intensify.
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