Prediction platform Polymarket in talks to raise funds at up to $15bn valuation | Business
Online prediction platform Polymarket, which hosts bets on events such as the Iran war, is in talks to raise $400 million (£296 million) at a valuation of up to $15 billion.
The company has gained notoriety in recent months for betting on the Middle East conflict, including the timing of US-Israeli attacks on Iran and the US-Iran ceasefire; some of these appeared to bear signs of insider trading.
During this time, the US company has experienced a huge increase in volume, with more than $1 billion being traded weekly on its platform. Polymarket receives a commission from some of these transactions, with a fee structure that varies depending on the type of bet. IT states that geopolitics and world event markets are “free.”
The latest round of fundraising could value the business at around $15 billion, up two-thirds from the previous valuation, according to tech news site The Information.
The value of Polymarket soared, reaching a $1 billion price tag in June last year after Peter Thiel’s Founders Fund led a $200 million round, followed months later by the New York Stock Exchange owner committing $1 billion at a $9 billion valuation. Intercontinental Exchange, which owns the NYSE, has since invested another $600 million in Polymarket.
It said it would be a “global distributor” of Polymarket’s data, using it to provide “sentiment analysis” to investors who could use bets on the platform to inform their strategies.
Data feeds from Polymarket and other online prediction markets are increasingly shaping trading, including oil markets.
Polymarket’s investors include a venture capital company owned by Donald Trump Jr. The company asked users “Will TikTok be banned in the US this year?” It allows one to effectively bet on the outcome of events by buying and selling shares on a future outcome such as
But a large number of bets placed by anonymous accounts on the platform have led to speculation that people are using inside information to make money. Israeli officials earlier this year arrested Several individuals and two individuals have been charged on suspicion of using confidential information to place Polymarket bets.
An investigation by the Guardian has found that thousands of people in online communities on Discord have developed strategies on how to make money from the conflict by betting on Ukraine’s front lines, placing arbitrage bets on geopolitical events and copying bets that at times appear to be insider wallets.
This research found that Polymarket gamblers appeared willing to pressure independent organizations (media and think tanks) to change their reporting to allow these gamblers to win bets. Polymarket gamblers recently threatened an Israeli journalist, demanding that he change his article so they could bet on whether Iran would strike Israel on a specific date.
But Polymarket doesn’t just host bets on the conflict: other bets include the second coming of Jesus Christ, the possible date of departure of UK prime minister Keir Starmer and election results around the world.
Polymarket’s popularity surged during the 2024 US presidential election. At the time, prominent US pollster Nate Silver joined the platform’s advisory board, saying prediction markets, which offer users the opportunity to bet on an outcome, could be a superior way of predicting events because they encourage monetarily accurate predictions, unlike surveys.
But while Polymarket’s supporters say it offers a “signal of accuracy”, experts warn it could lead to distortion in larger markets. A small segment of users can manipulate larger financial markets by placing strategic bets, distorting the probabilities of certain events, and these effects are reflected in the companies and institutions that place increasingly greater stakes in the platform’s predictions.
Polymarket has been approached for comment.
