Prediction market platform Kalshi is reportedly in early-stage discussions to raise new funding at a valuation of approximately $40 billion. This potential financing round follows a period of rapid growth for the company, which last raised $1 billion in a Series F round in May 2026, valuing it at $22 billion. The discussions are preliminary and may not ultimately result in a deal at this valuation.
The news of the potential $40 billion valuation comes as Kalshi has seen its annualized revenue surpass $2 billion, doubling from the $1 billion run rate reported in March 2026. The company's annualized trading volume has also surged, going from $52 billion to $178 billion, with institutional trading alone increasing by over 800% in the past six months. May 2026 saw notional trading volume hit a record near $17 billion.
Kalshi, founded in 2018, operates as the largest CFTC-regulated prediction market exchange in the United States. Its growth has attracted significant investor interest, with notable participants like Coatue, Sequoia Capital, Andreessen Horowitz, Morgan Stanley, and ARK Invest in its previous funding rounds. The company is also exploring an initial public offering (IPO), having engaged in informal discussions with investment banks, although a public listing is likely still more than a year away, potentially in late 2027 or 2028.
The substantial increase in valuation from $11 billion in December 2025 to a potential $40 billion reflects the growing mainstream acceptance of event-based trading as a legitimate financial instrument. However, Kalshi faces ongoing regulatory scrutiny, particularly from state authorities concerning some of its event contracts resembling sports betting. A critical question for any future IPO will be whether its valuation, partially driven by sports-betting volumes, can withstand public-market scrutiny amidst these jurisdictional issues with the CFTC.
