The venture firm 1789 Capital, which counts Donald Trump Jr. as a partner, is leading a new $1 billion funding round for prediction market operator Polymarket, a transaction that values the company at $21 billion. The firm plans to contribute approximately $300 million, according to a spokesperson, building on an earlier investment of roughly $200 million. The new financing marks a sharp rise from Polymarket's $15 billion valuation in April and highlights accelerating investor interest in event-based trading platforms.
Funding Structure and Valuation Surge
1789 Capital's new commitment would bring its cumulative investment in Polymarket to about $500 million, positioning it as one of the platform's largest financial backers. The round follows an April financing involving D.E. Shaw and G Squared that valued the company near $15 billion. The reported $21 billion valuation represents a 40 percent increase within a few months, although final investors and terms have not yet been publicly confirmed.
Intercontinental Exchange, owner of the New York Stock Exchange, holds roughly 22 percent of Polymarket's outstanding shares, a stake valued around $1.6 billion. That ownership reflects deeper institutional ties after ICE agreed to invest up to $2 billion in Polymarket. The company completed an additional $600 million cash investment in March 2026, further cementing the exchange operator's role in the prediction market's expansion.
Competition With Kalshi Intensifies
Polymarket's new valuation brings it close to rival Kalshi, which raised capital at a $22 billion valuation in May. Both companies let users trade on outcomes spanning politics, sports, economics, entertainment and financial events, and their growth has accelerated over the past year. The two platforms are now aggressive competitors as prediction markets expand beyond their original political focus.
Polymarket is also seeking to attract institutional traders through possible margin trading approval in the United States. This would allow sophisticated users to deploy capital more efficiently instead of fully collateralizing every position. The push reflects broader ambitions to move from a retail-heavy user base toward deeper financial market participation.
Regulatory Scrutiny and Political Ties
Trump Jr. joined 1789 Capital as a partner after the 2024 presidential election and later became an adviser to Polymarket. He separately advises Kalshi and has received equity in that company valued at more than $300,000. These dual roles have drawn attention because prediction markets are affected by federal regulatory policy.
The Trump administration has adopted a generally supportive posture toward the industry under Commodity Futures Trading Commission Chairman Michael Selig. The CFTC has challenged state-level attempts to restrict federally regulated event contracts, while Selig has praised the companies. Democratic lawmakers have raised questions about potential conflicts involving the Trump family's financial connections to the sector.
1789 Capital has rejected suggestions that its investment performance stems from political influence, and Trump Jr. has said he invests as a private citizen with no policy-making role. The firm reportedly now manages more than $3 billion, up from several hundred million dollars about two years ago, and its growth equity fund has posted returns of roughly 200 percent through the third quarter. Its portfolio includes SpaceX, Anduril, Cerebras and Reflection AI, with Polymarket potentially becoming one of its most valuable positions.
If the round closes on the reported terms, Polymarket will have added another billion dollars of capital while its private valuation climbs by roughly $6 billion in a few months. The financing would solidify 1789 Capital's position as a leading backer of the platform and underscore how quickly investors have reassessed the prediction market sector. The transaction also illustrates the growing convergence of venture capital, event-based trading and Washington policy under the current administration.
Source: The Wall Street Journal