"Prediction market" Polymarket plans to raise $400 million at a $15 billion valuation.

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Prediction market platforms are becoming the focus of capital pursuit, with leading players competing to stake their claims.

According to The Information citing sources, Polymarket is seeking a new round of $400 million in funding at a valuation of approximately $15 billion. Intercontinental Exchange (ICE, the parent company of the New York Stock Exchange) has already invested over $600 million, and the total size of this round could reach $1 billion. The company is looking to bring in strategic investors besides ICE. However, this round of funding has not been completed and the terms are still subject to change.

The target valuation of $15 billion is more than 66% higher than Polymarket's $9 billion valuation in its previous round last October. However, this level is still lower than its competitor Kalshi. According to Bloomberg, Kalshi last month completed a $1 billion financing round at a $22 billion valuation, led by Coatue Management.

Plans to Launch Token and Advance IPO, Catching Up with Kalshi

The over $7 billion valuation gap between Polymarket and Kalshi largely stems from significant differences in their commercialization progress. Polymarket only recently launched its platform to U.S. users and has just begun adjusting its fee model to generate revenue. In contrast, Kalshi has been deeply cultivating the U.S. market for years, and its annualized revenue has surged to $1.5 billion.

Polymarket has been established for nearly six years, and another key difference from Kalshi lies in its technical architecture—its transaction settlement is built on blockchain. Sources say the company has been discussing token issuance for nearly a year and plans to eventually seek an initial public offering.

Both Prediction Platforms Face Regulatory Hurdles

Polymarket has not had a smooth regulatory journey. In 2022, the company was fined by the U.S. Commodity Futures Trading Commission (CFTC) and forced to exit the U.S. market for providing trading services to U.S. users in violation of regulations. Afterwards, Polymarket acquired a U.S.-registered derivatives exchange and a New York entity last year to obtain compliance licenses, enabling it to launch a new platform for U.S. users and achieve a compliance breakthrough.

At the same time, Kalshi is facing regulatory lawsuits in several states, where authorities are trying to prevent it from offering sports betting services—a business that is an important source of tax revenue for some states. Kalshi argues that these accusations lack basis and emphasizes that it is overseen by federal regulator CFTC.

Tightening Regulations: Insider Trading Issues Surface, Prediction Market Betting Boundaries Continue to Expand

While the industry is expanding rapidly, insider trading issues have begun to attract regulatory attention. Earlier this year, an OpenAI-affiliated company exited the prediction market after participating in trades using internal information. Recently, reports related to bets on Middle East developments have been brewing, and bipartisan members of Congress have jointly introduced a bill to prohibit federally appointed officials and government employees from using insider information to participate in prediction market contract trading.

The rise of prediction markets originated from the 2024 U.S. presidential election—these platforms became popular channels for betting on election outcomes. Most platforms allow users to purchase event contracts for $1; if the bet is correct, the platform returns the principal and pays the winnings. The low threshold and broad range of betting targets—from NCAA (National Collegiate Athletic Association) "March Madness" champions to AI model release dates—make prediction markets an emerging alternative to sports betting and stock trading.

Risk Warning and DisclaimerThe market involves risks; investment requires caution. This article does not constitute personal investment advice and has not taken into account the special investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific situation. Investment is at your own risk. ```