Blockchain-based prediction and trading platform Polymarket is reportedly in the final stages of closing a $200 million funding round, which would give the platform a total valuation of $1 billion, sources have told Reuters and Bloomberg. Of the total round, $50 million has already been raised in undisclosed earlier rounds.
Peter Thiel's venture capital firm Founders Fund is leading the round, according to the reports. The investment follows greater interest in event-driven trading, particularly following heightened political uncertainty and macroeconomic volatility.
Key Takeaways
- Polymarket blockchain trading platform is in the final stages of raising $200 million.
- The funding will bring the company to a total valuation of more than $1 billion.
- The funding is led by the company founders, who reportedly raised the first $50 million in previous rounds.
Polymarket was founded in 2020 by Shayne Coplan and is now one of the leading prediction market platforms where traders place bets on the outcome of real events with cryptocurrency. The Polymarket platform enables traders to buy and sell shares representing the outcome of a future event, where outcomes are always priced between $0 and $1, and every pair of event outcomes (i.e., "yes" and "no") makes a full collateral of $1. The mechanism collates all trading data to reflect consensus probabilities in real-time.
This form of event derivatives trading has gained traction, especially during the 2024 U.S. presidential election. Traders turned to Polymarket to speculate on the outcome, often diverging from mainstream polling data.
Due to Commodity Futures Trading Commission (CFTC) guidelines, the platform does not serve U.S.-based users, yet international activity has grown significantly.
Recent data from SimilarWeb shows that Polymarket saw 15.9 million visits in May – more than established betting sites, including FanDuel and DraftKings. Dune Analytics reports that its prediction accuracy reached 94%, helping it gain recognition as an alternative source for forecasting.
Polymarket's growing prominence was further cemented by a new partnership with Elon Musk's xAI initiative, positioning Polymarket as the official prediction market for both xAI and social media platform X.
Goldman Sachs monitors geopolitical risks through Polymarket
Utilizing the wisdom of the masses, investment and financial services giant Goldman Sachs has begun referencing Polymarket's prediction markets to analyze geopolitical risk scenarios and economic tensions, including those involving the Middle East. The investment bank is said to be analyzing bets on high-level events such as the status of the Iranian nuclear facilities, regime change, and the potential closure of the Strait of Hormuz – a waterway vital to the world's oil supply.
Millions of dollars are at stake with these results. Notably, a $4 million pool has formed around the possibility of the Fordow nuclear facility being destroyed before July. Similarly, bets totaling $3 million speculate on the departure of Iran's Supreme Leader Ali Khamenei.
In addition, $5 million is tied to whether Tesla will unveil a driverless Robotaxi by mid-year. A leading market with $8 million in stakes predicts a U.S. recession in 2025.
Polymarket data suggests a 99% chance of a ceasefire between Israel and Iran before July. Conversely, another U.S. military action against Iran by the end of June holds a 5% chance.
The granular insight provided by Polymarket's pricing has emerged as a salient tool for financial institutions seeking to synthesize public sentiment into actionable intelligence despite the ongoing regulatory controversy surrounding its operation within the U.S.
