A number of well-known hedge funds participated in Kalshi’s recent $1 billion Series G funding round. The financing, co-led by Wellington and Sequoia, values the prediction company at $40 billion, according to the company.
Participating hedge fund investors included Coatue Management and Balyasny Asset Management, according to the announcement. Crunchbase notes that Millennium Management and Tiger Global Management also participated.
The financing comes less than six months after Kalshi announced a $1 billion Series F round at a $22 billion valuation. It was led by Coatue, with participation from Sequoia Capital, Andreessen Horowitz, IVP, Paradigm Capital, Morgan Stanley, and ARK Invest.
At the time, Kalshi said it would use the capital to scale adoption across hedge funds, asset managers, proprietary trading firms, and insurance companies.
“Kalshi is building the leading platform for trading in real-world events,” Coatue founder Philippe Laffont said in the press release. “Consumers have already embraced it, and we believe institutions will follow.”
Two legendary WNBA players, Diana Taurasi and Breanna Stewart, invested in Kalshi’s earlier Series E round.
In its most recent announcement, Kalshi stressed that it started as a prediction market but has diversified quickly. It says it now has more than $1 billion in nonsports annualized revenue and its overall business's annualized trading volume exceeds $1 trillion, noting that more than 30 million Kalshi accounts have been created. The company accounts for more than 75 percent of prediction market trading volume.
“Every exchange has an initial killer product,” Kalshi emphasized. “Sports brought millions of people to Kalshi and helped establish deep liquidity. We’re now extending those network effects into politics, crypto, economics, commodities, and perpetual futures.”
It says its commodities business generated $100 million-plus in annualized trading fees in just three months. Kalshi adds that crypto trading volume has reached $140 billion annualized and politics trading volume has reached more than $8 billion annualized.
And one year after Kalshi launched in more than 140 countries, its international retail business is approaching $100 million in annualized trading fees, per the announcement. Since its launch a few months ago, its perpetual futures business has reached $83 billion in trading volume and more than 500,000 traders.
“As more participants join, they bring liquidity that makes the exchange more useful for everyone,” Kalshi explains. “That liquidity supports new markets, attracts new participants, and expands the range of products we can offer. This is how we’re building a diversified financial exchange with prediction markets at its foundation.”
But prediction markets like Kalshi are controversial. Critics say they are little more than gambling vehicles.
Utah recently filed 14 criminal charges against the company and its co-founders, asserting they are breaking the state’s gambling laws. However, the Commodity Futures Trading Commission then sued Utah, calling for an end to the investigation.
