Investors are valuing Polymarket at a discount to archrival Kalshi—and its crypto ties could be one reason why

The prediction market space is one of the fastest-growing in finance. Two years ago, Polymarket reportedly raised funds at a $350 million valuation. Today, the platform is in talks to raise funds at a valuation of $15 billion, The Information reported . But the windfall may be made a little less sweet by the success of Polymarket’s bitter rival, Kalshi, which was most recently valued at $22 billion. The nearly one-third valuation discount for Polymarket could be explained by Kalshi’s stronger foothold in the U.S., where it currently holds roughly 90% market share , or by its stronger revenue figures, since Polymarket just recently started charging trading fees. But the reason for investors’ discounting of Polymarket could lie with a more idiosyncratic factor—the cryptocurrency token the company plans to launch, which makes it more difficult to gauge the stickiness of Polymarket’s current trading volume. The recent divergence in how investors value Polymarket and Kalshi is noteworthy given that the two companies’ valuations have moved in lockstep for the past year. Polymarket and Kalshi offer nearly the same product, and if prediction markets turn into a winner-take-most sector, then the horse race between the two startups could have major stakes for investors. One key difference between the firms, though, is that Polymarket’s non-U.S. arm is built on blockchain rails, and the project has deep roots in the crypto space: Its 2020 seed round was backed by crypto venture capital firms Polychain, ParaFi, and 1confirmation. This is in contrast to Kalshi, which runs on traditional financial rails and is generally less ingrained in the crypto world. What’s a token worth? Polymarket has teased the idea of releasing a crypto token for years. The company’s chief marketing officer said in an October 2025 podcast appearance that “there will be a token, there will be an airdrop,” referring to a practice where crypto projects will distribute free tokens to power users in a bid to…