Prediction market Kalshi is in talks to raise capital at a valuation of about $40 billion.

According to the Financial Times, citing people familiar with the discussions, the round could close in the third quarter. 

Prediction Markets Draw Wall Street Capital

The financing would follow a $1 billion Series F raise completed last month. That earlier round valued the company at $22 billion. Coatue led the round. Other backers included Sequoia Capital, Andreessen Horowitz, IVP, Paradigm, Morgan Stanley, and ARK Invest.

Kalshi’s valuation has climbed steeply. The platform was worth $11 billion in December 2025 and about $5 billion earlier last year. This signals how fast prediction markets are drawing Wall Street capital.

Meanwhile, rival Polymarket trails Kalshi by a widening margin. The platform reportedly approached investors in April about a $400 million raise, targeting a valuation near $15 billion.

Kalshi declined to comment on the financing. 

Kalshi Challenges Illinois in Latest Lawsuit

The fundraising efforts come as the platform battles state-level attempts against its sports-related contracts. Kalshi sued Illinois officials in federal court. The complaint targets SB 3019.

The law would treat prediction-market contracts tied to sports as “exchange wagers.” It would require Kalshi to obtain a state gaming license, which would cost millions to maintain its ability to offer the contracts.

Kalshi argues the measure violates the Supremacy Clause. The company says the Commodity Futures Trading Commission (CFTC) holds exclusive jurisdiction over event contracts on federally designated markets.

“Kalshi is fundamentally different from state-regulated sportsbooks and casinos. Courts have already recognized our status as a federally regulated exchange. Illinois is wasting its time and taxpayers’ dollars,” Kalshi’s Jacki McGavick told BeInCrypto. 

The filing notes SB 3019 takes effect July 1. Kalshi warns it would otherwise face an impossible choice: halt its contracts, submit to a costly state licensing regime, or risk criminal penalties.

Source: BeInCrypto