Polymarket Eyes Major Valuation Boost with US Market Re-entry

By: Isha Das

Prediction market Polymarket is on the verge of a significant leap in valuation as it prepares a strategic re-entry into the US market. The company, which utilizes blockchain technology to facilitate prediction markets on various outcomes from political elections to cultural events, is reportedly seeking new funding that could elevate its valuation to an impressive $10 billion. This anticipated increase, first reported by industry insiders, represents more than a tenfold surge from its $1 billion valuation achieved during a funding round earlier this year.

Key behind Polymarket's ambitious valuation target are strategic developments and regulatory maneuvers positioning the firm for a strong comeback in the US. Central to these efforts is the no-action relief issued by the Commodity Futures Trading Commission (CFTC), which allows Polymarket to resume operations in compliance with federal derivatives regulation. This move follows the company's previous cessation of US operations in 2022 after settling a CFTC action over unregistered derivatives trading.

Adding to Polymarket's strategic arsenal is the involvement of Donald Trump Jr. His venture capital firm, 1789 Capital, recently made a strategic investment in the platform, and he joined the advisory board in August. His role is expected to lend significant political expertise as Polymarket navigates its US market entry. Trump Jr. has publicly commended Polymarket for its ability to offer market-based predictions that counter traditional media narratives, thereby enhancing its value proposition as a trusted information platform.

Despite an increase in trading volume, the company has faced challenges in maintaining user growth, with a drop in the number of active and new users since the start of the year. However, company executives are optimistic that their US expansion, bolstered by regulatory approval and high-profile advisory additions, will reverse these trends. The platform has already surpassed $8.5 billion in trading volume for the year, a clear indicator of its growing appeal despite user number fluctuations. With these strategic moves, Polymarket aims to solidify its status as a leader in the burgeoning prediction market sector.