Investment firm 1789 Capital, where Donald Trump Jr. is a partner, is reportedly leading a $1 billion investment round into blockchain-based prediction market Polymarket with a contribution of about $300 million.
According to sources speaking to the Wall Street Journal, the new funding round would value Polymarket at $21 billion, placing it just below its main competitor, Kalshi, which holds a $22 billion valuation. This latest injection would increase 1789 Capital's total investment in Polymarket to approximately $500 million, establishing the firm as one of the platform's largest backers.
ICE currently remains Polymarket's largest disclosed investor. A July 30 10-Q filing from ICE revealed a combined $1.6 billion investment in Polymarket preferred shares, with a carrying value of approximately $2 billion as of June 30. These holdings represent about 22% of outstanding shares, or 14% on a fully diluted basis.
Earlier, in April, Polymarket reportedly initiated talks to raise $400 million in fresh capital at a potential $15 billion valuation.
Regulatory Scrutiny and Market Pressures
The funding news arrives as prediction markets encounter heightened regulatory scrutiny both in the United States and globally.
- Banking Relations: On August 14, JPMorgan Chase reportedly ended a banking relationship with Polymarket due to regulatory concerns, though the bank noted a continued interest in a potential underwriting role if the platform pursues a public offering.
- Legal Challenges: More than a dozen US states have initiated legal action against Polymarket, Kalshi, or both regarding sports event contracts. Additionally, authorities in multiple countries have restricted or blocked access to Polymarket.
