Kalshi Prepares for a Historic IPO: $2 Billion in Revenue and a Battle with U.S. Regulators
Prediction market platform Kalshi is in preliminary discussions with investment banks about a potential initial public offering (IPO). The listing is expected to take place in late 2027 to early 2028. This event could be the first of its kind for the sector, drawing close attention from both investors and regulators.
Kalshi's financial performance is impressive: the company's annual revenue exceeded $2 billion, roughly three times the level of November 2025. In May 2026, monthly trading volume reached $16.81 billion, showing a 13.5% increase from April. The main driver of this growth was a surge in activity around the NBA markets and the 2026 FIFA World Cup. Additionally, the company partnered with the National Hockey League (NHL).
Strong Capital Inflow and Expansion
In May, Kalshi raised $1 billion in a Series F round at a valuation of $22 billion. The round was led by Coatue, with participants including Sequoia Capital, Andreessen Horowitz, IVP, Paradigm, Morgan Stanley, and ARK Invest. Since the start of 2025, the company has closed four major funding rounds. Concurrently, Kalshi launched CFTC-approved perpetual futures on Bitcoin (BTC) and other crypto assets, drawing criticism from CME Group, which insists on different regulation for such contracts.
Regulatory Risks: The Main Threat
The primary risk for Kalshi is regulatory uncertainty at the state level. This week, the state of Kentucky filed a lawsuit against Kalshi and Polymarket over allegedly unlicensed sports betting. Similar documents were filed by representatives of Wisconsin, New York, Nevada, and other states. U.S. gaming associations have urged the Senate to include a ban on sports prediction markets in the Clarity Act bill.
Meanwhile, the CFTC insists that prediction markets are under its sole jurisdiction and is litigating with several states. In April 2026, a New Jersey court sided with Kalshi, allowing it to offer sports contracts, but the final decision will likely rest with the U.S. Supreme Court.
Going public will provide Kalshi with capital for growth and strengthen institutional investor confidence. However, the main risk remains: if sports prediction markets are deemed illegal, the company could lose up to 90% of its revenue—its primary income source.
My analysis: Kalshi's potential IPO is a landmark event for the entire industry, but its success directly depends on the outcome of legal proceedings. If the U.S. Supreme Court supports the states' position, it could not only derail Kalshi's plans but also set a dangerous precedent for the entire decentralized prediction market sector. Investors should closely monitor developments in Washington.