Kalshi reaches $40bn valuation as state legal fights multiply
A $1bn Series G funding round pushed the prediction markets operator to its target valuation even as Utah and Arizona pursue felony charges against the company.
Kalshi has reached the $40bn valuation it had been working towards through much of 2026, closing a $1bn Series G funding round co-led by Wellington Management and Sequoia Capital, according to SBC News.
The round also drew backing from firms including Stripes, Andreessen Horowitz, Coatue, Layer Global, CapitalG, Hudson River Trading, Balyasny Asset Management, Morgan Stanley Investment Management, Sequoia Global Equities and Baillie Gifford. Kalshi said it would direct the fresh capital towards developing what it termed a next-generation financial exchange.
The valuation also lands in a week when Kalshi struck a tie-up with S&P Dow Jones, a major provider of market indices, deepening its links to mainstream finance.
The milestone has revived talk of a possible public listing, likely on the New York Stock Exchange, though chief executive Tarek Mansour has previously said such a move is unlikely before late 2027.
The growth comes despite an increasingly hostile legal environment in several US states. Utah this week filed 13 felony charges against Kalshi, following Arizona's earlier filing of 20 felony charges against the company.
The Utah case is politically awkward for the company. A state that has been a Republican stronghold since the late 1960s is now pursuing Kalshi, even as the federal Commodity Futures Trading Commission has turned supportive of prediction markets under the Trump administration, having been far more combative towards them while Biden was in office. A number of state-level gambling regulators and governments, meanwhile, still regard the products as unlicensed betting.
Internationally, the picture is similarly fractured. France, the Netherlands, Portugal and the Czech Republic are among the countries that have rejected prediction markets outright, SBC News reported. The UK's Gambling Commission has indicated that platforms would need a gambling licence to operate, a route Kalshi and rival Polymarket have resisted, insisting their products are financial services rather than betting.
Mansour set out that distinction on X this week, sharing an op-ed he wrote for The Wall Street Journal. "Yes, a bet and a trade often look similar," he wrote. "But how they work is fundamentally different. A sportsbook sets the odds and takes the other side of your bet." He added that prediction markets instead let "buyers and sellers compete to discover and produce efficient prices and enable important public benefits."
Polymarket, which is reportedly seeking its own valuation of around $22bn, has reportedly held talks with both the UK's Financial Conduct Authority and ESMA, the EU's securities regulator, in an effort to build regulatory acceptance in Europe, according to SBC News.
Gibraltar has gone further than any other jurisdiction, becoming the first to establish a dedicated regulatory framework for prediction markets and approving two firms, ADI Predictstreet and Wire Markets, under that regime.
Kalshi maintains that institutional adoption is growing regardless of the legal pressure. The company said around 500 institutional entities were active on its platform as of September 2026, with entities excluding market makers accounting for roughly 25% of total exchange trading volume.