Prediction market platform Kalshi has raised more than $1 billion in an ongoing funding round led by Coatue Management, valuing the company at approximately $22 billion, according to people familiar with the matter.

The Wall Street Journal first reported the deal, citing sources who said the financing would total about $1 billion and double the startup's valuation within months. Bloomberg later reported that the round had surpassed $1 billion, confirming the $22 billion valuation and Coatue's lead role in the financing.

The new valuation marks a sharp increase from Kalshi's $11 billion Series E round in November. The New York-based company operates a federally regulated exchange that allows users to trade contracts tied to the outcomes of real-world events. Kalshi supports crypto deposits and withdrawals but converts funds into fiat for trading, contrasting with rival Polymarket's fully crypto-native infrastructure, which has historically restricted U.S. users until recently.

Kalshi's annualized revenue run rate has reached about $1.5 billion, according to the WSJ. The platform serves retail traders, institutional market makers, and businesses that use its contracts to hedge against uncertain outcomes. Growth in institutional participation has helped drive investor interest in the latest round, one of the people said.

A Kalshi spokesperson declined to comment when contacted by The Block.

Rapid growth draws investor demand despite regulatory headwinds

The raise comes as Kalshi and Polymarket have both reportedly explored fundraising at valuations around $20 billion in recent months, reflecting substantial growth across the prediction market sector. Trading volumes have surged, fueled by growing interest in event-based contracts and new product categories such as sports-related markets.

Kalshi's growth has also drawn increasing scrutiny from lawmakers and regulators. The sector's rapid expansion has raised concerns about potential insider trading and market manipulation tied to prediction contracts, even as investor appetite remains strong.

At the state level, legal pressure continues to mount. Arizona recently filed criminal charges against Kalshi's parent entities, alleging that it operates an illegal gambling business without a license. Kalshi has pushed back, calling the charges "seriously flawed" and arguing that its contracts fall under federal derivatives regulation overseen by the Commodity Futures Trading Commission.

Legal disputes are also unfolding across multiple jurisdictions. A March 19 order from the U.S. Court of Appeals for the Ninth Circuit denied Kalshi's emergency request for an administrative stay in a Nevada-related case, potentially allowing further state-level action against the platform.

Despite the regulatory overhang, institutional engagement remains strong. Firms such as Susquehanna International Group and Jump Trading are active as market makers on Kalshi, while Tradeweb Markets recently partnered with the company to distribute prediction market data. The latest funding round suggests investors continue to back the sector's growth trajectory even as legal and political risks persist.