Kalshi reportedly in talks to raise about $1B at roughly $40B

Kalshi runs an exchange where retail and institutional traders take opposite sides of yes-or-no questions about events, from interest rates and weather to elections. Reuters reported in a story carried by MarketScreener that the company is in advanced talks to raise about $1 billion from new and existing investors at a roughly $40 billion valuation. People familiar with the confidential discussions expect the financing to close within weeks, but it remains a negotiation rather than a completed round.

A customer chooses Yes or No, posts or accepts a price, and is matched with a member taking the other side. The price reflects the market’s collective estimate of the outcome; a correct contract settles at $1. The counterparty is another member, not Kalshi.

Kalshi monetizes that exchange role rather than trading against customers. The company says it has no financial stake in which side wins and earns money by charging transaction fees based on a contract’s expected earnings. Directional traders, hedgers and market makers use the venue, though Kalshi’s help materials say most participants are retail traders. Because revenue comes from transactions, trading activity matters without requiring Kalshi to wager against its customers.

If the reported terms hold, the deal would follow a $1 billion financing in May that Reuters said valued Kalshi at $22 billion. A roughly $40 billion valuation would be about 82% higher than that earlier figure. The proposed round matches May’s funding amount while repricing the company nearly four-fifths higher.

Sequoia Capital and Wellington Management are discussing leading the round, while Tiger Global and Dragoneer are prospective participants, Reuters reported. The same report said Kalshi is pushing beyond prediction markets into a wider range of asset classes, an expansion that would bring it into closer competition with traditional exchange operators as well as prediction-market rivals.

Kalshi says its exchange is regulated by the Commodity Futures Trading Commission. That framework supports its service to both retail and institutional traders. But the category is expanding into contracts linked to large public companies, and Reuters noted growing questions about investor protection and market oversight.