Kalsi raises $300 million at $5 billion valuation

Prediction markets are no longer a niche crypto subculture. They are mainstream finance.

Karsi, one of the world’s largest prediction markets accepting Bitcoin deposits, announced it has raised $300 million in new funding at a $5 billion valuation and will soon open up access to users in more than 140 countries, according to the New York Times.

The round, led by Sequoia Capital and Andreessen Horowitz, with participation from CapitalG, Coinbase Ventures, Paradigm and others, more than doubles Kalsi’s valuation from its previous funding in June.

The company’s annual trading volume has jumped from $300 million last year to an expected $50 billion.

Kalsi’s rise comes amid a boom in online prediction markets, where people can trade contracts tied to the outcome of real-world events. These events include elections, sporting events, inflation rates, and even the weather.

These markets allow traders to express their views on future events and profit if their predictions are correct, working like a blend of gambling and derivatives trading.

Prediction market trading volume is skyrocketing

The timing of Kalsi’s announcement highlights the growing competition in the field. Earlier this week, rival platform Polymarket revealed that the New York Stock Exchange’s parent company plans to invest up to $2 billion.

As of the week of September 29, trading volume on Karsi’s platform exceeded $956 million, nearly double that of Polymarket, according to data provider Dune.

Kalsi’s recent growth has been fueled by the sports market, especially since introducing parlays, which are multi-leg bets common in traditional sports betting.

The move has rattled established sportsbooks like DraftKings and FanDuel, whose stock prices have plummeted in recent weeks.

Kalsi has also expanded distribution through integrations with brokerages such as Robinhood and Webull, allowing users to trade predictive contracts as easily as buying stocks.

Regulatory hurdles for calci

Even as Kalsi expands, it faces increased regulatory scrutiny. The company operates under the oversight of the U.S. Commodity Futures Trading Commission (CFTC), but several state regulators have challenged the sports deal, arguing that it effectively circumvents state-level gambling regulations.

“Whenever there is a new type of financial innovation, it always raises a series of questions around regulation,” co-founder and CEO Tarek Mansour told the NYT. “If we didn’t have regulation, what we’re doing probably wouldn’t be meaningful or innovative enough.”

Calci’s regulatory compliance remains a strategic advantage, especially as Polymarket seeks to regain access to the US through its recent acquisition of a CFTC-licensed exchange. Still, Kalsi is looking beyond regulation as a differentiator.

Kalshi accepts Bitcoin and other cryptocurrency deposits through its partnership with ZeroHash.