Wall Street’s newest wizards faced the full force of the federal government a year ago.
Now, with President Donald Trump at the helm, Shayne Coplan and Tarek Mansour — the scruffy-haired, 20-something billionaires behind betting platforms Polymarket and Kalshi — are big.
Coplan’s Polymarket is returning to the US, a year after federal agents raided his apartment as part of an investigation into whether the company was operating illegally domestically. And Mansour’s Kalshi defeated the Commodity Futures Trading Commission, its main regulator, in an election betting battle. Both are now expanding into politics and sports, while attracting big-name backers like Donald Trump Jr. and the parent company of the New York Stock Exchange.
The companies, known as prediction markets, make online bets on everything from the election to the details of Taylor Swift’s wedding to the return of Jesus Christ. This trade then generates odds that show the likelihood of a particular event happening, such as who will win the 2028 presidential election. (Vice President JD Vance’s odds are currently at about 30 percent, the highest of any competitor on Polymarket and Kalshi.)
Once a fringe corner of finance, prediction markets could eventually become a trillion-dollar industry, according to Mansour, making online betting ubiquitous in everyday life. This raises questions about the potential for insider trading and other risks that come with gambling on anything and everything. As the largest players, Polymarket and Kalshi will benefit the most.
The story behind the comeback of these two companies offers a window into what it takes to get ahead in Trump’s Washington, where few have seen their stars rise so quickly before.
Federal regulators under then-President Joe Biden alleged in 2022 that Polymarket operated an unregistered exchange in the US, prompting the company to agree to block US traders. But both the Justice Department and the CFTC later investigated whether U.S. traders were still active on Polymarket by hiding their locations online, leading to the morning raid on Coplan’s apartment. Biden’s CFTC blocked Kalshi from accepting election bets, which the company successfully challenged in court.
Fast forward a year, and Trump’s Justice Department and the CFTC dropped their investigations into Polymarket, setting the stage for the company’s comeback. The CFTC also dropped its appeal of the Kalshi decision, opening the door for billions of dollars in new bets. The agency wrote in a statement that the appeal was dropped following a bipartisan vote “after it became clear that the CFTC was likely to lose.”
Over the past year and a half, Polymarket and Kalshi have hired key Trump allies and run amuck with the president and his circle. They have also benefited from the Trump family’s interest in less traditional finance, such as cryptocurrencies. And they were quick to take advantage of the friendlier regulatory landscape.
The result: Polymarket is now valued at $9 billion and Kalshi at $11 billion. Both companies list Trump Jr. as an adviser. Polymarket also considers young Trump as an investor. And both are inking new deals with CNN, CNBC, the National Hockey League and the Ultimate Fighting Championship.
If prediction markets catch on, polls and media will face new competition from players and traders for election forecast information, as companies say their platforms offer more accurate odds. On the international platform of Polymarket alone, the 2028 election market has already reached a volume of more than 150 million dollars. Analysts at Citizens Financial Group recently estimated that revenue from the prediction market industry could grow from $2 billion now to north of $10 billion by 2030.
“They really took a gamble and it paid off with Trump’s victory,” said Pratik Chougule, a political market trader who knows Coplan and Mansour. “We’re in a very, very permissive regulatory environment.”
Mansour, in a recent interview, called it a “seminal moment” for prediction markets. “This will be bigger than the scholarship.”
Neal Kumar, Polymarket’s legal director, said the regulatory environment was not “do what you want”. Rather, he said, it “gives prediction markets the opportunity to grow.”
The companies and their supporters argue that they are well-regulated financial exchanges that operate under strict consumer and investor protections, a significant improvement over casinos and sportsbooks, in their eyes. But skeptics say the markets could also make betting and the risks they bring — from addiction to rigged events — more ubiquitous in everyday life. Dorothy DeWitt, a former CFTC official, compared it to an episode of “Black Mirror,” referring to the “Twilight Zone”-like television series.
“Is Congress ready for this? No, no more than they were ready for crypto and social media a decade ago,” she said.
At the Republican National Convention in Milwaukee last summer, Coplan, wearing a dark T-shirt, met Trump Jr. and financier Omeed Malik for the first time, according to a person with direct knowledge of the meeting, who, like several others for this article, spoke on condition of anonymity to discuss the companies candidly.
The person said they were introduced through a joint investor in Polymarket and 1789 Capital, the venture capital firm run by Malik and in which Trump Jr. is a partner. (A photo of the meeting was widely shared on social media.)
Shortly after the election, during his first TV interview, Coplan teased Polymarket’s return to the US. The following week, Mansour met the president-elect at an Ultimate Fighting Championship event in New York City. In January, Kalshi started getting involved in sports.
Companies have also started to create staff. Polymarket hired David Urban, a former Trump campaign adviser, and Keaghan Ames, a lone CFTC official, as its first lobbyists. Kalshi added Trump Jr. as an adviser. Polymarket later did the same, announcing that 1789 Capital had invested in the company.
Both companies also have bipartisan ties: Democratic megadonor Ron Conway, for example, invested in Polymarket, and former Arkansas Democratic Sen. Blanche Lincoln is registered to work for Kalshi as a lobbyist.
“This is how Washington works,” said Dennis Kelleher, who heads the Wall Street watchdog group Better Markets. “There’s a race to be first and grow big and get your tentacles to different parts of Washington to make it harder to dislodge them.”
Elisabeth Diana, a spokeswoman for Kalshi, said the company is relying on “open channels with the government to navigate the ever-changing regulatory environment.” She added that the election betting ruling in favor of Kalshi came from a judge appointed by Biden and that the company has operated as a regulated exchange under both Democratic and Republican administrations. Diana declined to comment on personal interactions between Kalshi executives and elected officials.
Coplan, asked about Trump Jr. during a recent “60 Minutes” interview, said, “if I have people who believe in what I’m doing, who understand how politics works and can help me … there’s nothing wrong with that.” Polymarket declined to comment on the RNC meeting.
In a January social media post, Trump Jr. explained the companies’ appeal. Not only did both fight with Biden regulators, they also called Trump’s victory ahead of established prognosticators. He said in the post that he and his family watched Kalshi on election night “to know I won hours before the fake news.”
Trump Jr. and Malik declined to comment. A person close to Trump Jr. said he does not interact with the government as part of his roles with the companies.
Urban, Ames and Conway did not respond to requests for comment. In an emailed statement, Lincoln said the CFTC “ensures fair and orderly trading, preventing fraud and abuse while allowing the market to perform its function of determining contract values.”
Between flooding the CFTC with new market plans, suing over the election betting ruling and more recently lobbying around a series of pending applications from new competitors, Mansour and Kalshi have long been aggressive with the agency, according to a half-dozen people familiar with their interactions.
They have become bolder under Trump, one of the people said. Although Kalshi has always been able to connect with CFTC commissioners, more recently, “he would cold call them,” the person said.
“They are extremely, extremely aggressive,” a former CFTC official said of Kalshi. “Everyone is in front of everyone.”
When asked for comment, Kalshi’s spokeswoman Diana said “if by aggressive you mean pushing — successfully — for the legalization of electoral contracts on behalf of the entire industry, then yes.” The CFTC declined to comment.
Regulators who once pursued companies are now rolling out the red carpet. In September, Coplan and Mansour appeared on a panel hosted by the CFTC alongside Wall Street titans, including CME Group CEO Terry Duffy and Intercontinental Exchange CEO Jeff Sprecher.
The following week, Polymarket announced a deal in the works: Sprecher’s company—the owner of the NYSE—will invest up to $2 billion.
Former CFTC Chairman Chris Giancarlo, an adviser to Polymarket, said Mansour and Coplan are each the “poster child” of their growing industry. “It’s Terry Duffy and Jeff Sprecher from 30 years ago,” he said.
Spokesmen for CME and the Intercontinental Exchange declined to comment.
But trouble lies ahead outside of Washington. Polymarket and Kalshi face new competition from Robinhood, Duffy’s CME and even Trump’s parent company Truth Social. State officials are also challenging the legality of sports betting markets, which they say violate state gambling regulations.
The companies say they answer only to the CFTC and that their platforms are not sportsbooks, but federally regulated financial exchanges. The fight is drawing attention inside the Beltway: Sen. Catherine Cortez Masto (D-Nev.) told POLITICO sports prediction markets are the “equivalent of illegal gambling.”
So far, neither seems worried. Mansour’s Kalshi continues to raise money from investors. And in November, Coplan commemorated the anniversary of the raid on his apartment by posting a photo on social media of a cake with white frosting and sprinkles.
Caption: “Hail to free markets, the American dream, and $3000/hr lawyers.”
