Sports contributed more than 80% of Kalshi's overall trading volume as the NBA and NHL playoffs were underway. The offseason has hit, with no major football, basketball, hockey, or soccer leagues underway. Still, sports markets account for around 50% of Kalshi’s markets, although the company is looking to diversify.
Key Takeaways
● 50% of Kalshi markets cover sports even in the offseason for major events
● Kalshi players have drifted towards niche sports like the WNBA, UFC, and hot dog eating
● Kalshi is looking to diversify its trading markets by adding NFL parlays and entering new fields like financial investments
While MLB was the sports contract king, users also gravitated to UFC fights, the Club World Cup, and WNBA games. In addition, the Nathan's Hot Dog Eating Contest contributed 4% of Kalshi's overall trading volume.
Despite the drop in overall activity, sports remained Kalshi's leading driver of user activity. The Democratic primary for New York City mayor fueled non-sports trading.
The foray into sports has not been without turbulence. Seven states accused Kalshi of operating unlicensed sports betting and sent cease-and-desist (C&D) letters. The platform was sued in Nevada, and two further suits were filed in New Jersey and Maryland.
So far, Kalshi has won in Nevada and New Jersey, where judges have granted preliminary injunctions blocking the C&D orders.
Kalshi aims to merge financial apps with NFL parlays by 2025
Kalshi's expansion plans to mainstream prediction markets have already extended beyond sports into finance. Speaking at the Solana Accelerate conference in New York, CEO Tarek Mansour forecasted that Kalshi markets could be on major financial broker apps, like those used to handle 401(k) accounts, by the end of 2026.
This possible move aligns with Kalshi's general strategy of integrating prediction markets into daily financial planning. The company subsequently clarified that Mansour's announcement referred only to the availability of apps, not to approval by regulators for use in 401(k) portfolios.
Mansour also mentioned the platform's rapid expansion, describing Kalshi as among the fastest-growing U.S. companies. As its next move, the company is set to launch parlay-style products ahead of the 2025 NFL season.
Kalshi raises $185 million in funding, reaches $2 billion valuation
Kalshi has secured a funding round worth $185 million, boosting its valuation to $2 billion. Long-time crypto and blockchain investment company Paradigm led the round and was accompanied by Sequoia Capital, Multicoin Capital, and Citadel Securities CEO Peng Zhao.
A landmark court victory last year over the Commodity Futures Trading Commission (CFTC) permitted Kalshi to offer presidential election contracts, which helped markedly increase market visibility.
Apart from state-level legal confrontations, Kalshi faced regulatory challenges from the U.S. Commodity Futures Trading Commission. It won a battle in court against the regulator, and the other recent court victories are instilling additional confidence among investors.
