Kalshi and Polymarket jointly invest in a new fund, predicting a major step towards the "ecosystem" of the market.

Author: Wenser , Odaily Planet Daily

Behind the soaring trading volume in the prediction market, its ecosystem is also expanding rapidly.

Yesterday, 5c(c) Capital, a venture capital firm founded by two former Kalshi employees, released its latest fundraising plan , aiming to raise $35 million for investments in prediction market-related startups. Notably, the firm has already secured support from Kalshi CEO Tarek Mansour and Polymarket CEO Shayne Coplan, among others, with other investors including representatives from a16z, Ribbit Capital, and Multicoin Capital.

Meanwhile, this institution is not only the first venture capital firm focused on investments in the prediction market industry, but also the same entity that has received simultaneous funding from two prediction market giants, Kalshi and Polymarket, making it a truly groundbreaking development in the industry. Considering previous news such as Kalshi's launch of a prediction market alliance, plans to hold a prediction market conference, Polymarket's opening of LP market-making incentives, and the proliferation of various prediction market data platforms, prediction markets are gradually separating from the native crypto market and evolving into an independent emerging industry ecosystem.

When an industry's trading volume grows dozens of times in just one year, and when a platform's monthly trading volume is comparable to the entire industry's trading volume just a few months ago, prediction markets are aggressively invading the heartland of traditional betting platforms.

Polymarket CEO invests in Kalshi, former employee: a common choice of the two giants in the prediction market.

It is understood that the name of 5c(c) Capital comes from the provisions on prediction markets in the U.S. Commodity Exchange Act.

The two founders are veterans of Kalshi : Adhi Rajaprabhakaran was the No.2 trader in Kalshi Trading, Kalshi's associated market-making division, and the creator of the well-known market prediction podcast "50 Cent Dollars"; Noah Zingler-Sternig served as Kalshi's head of operations (similar to COO) and led the integration of Kalshi with Robinhood Markets Inc.

In addition, the fund plans to invest in about 20 companies over the next two years , focusing on market makers, index design, and other predictive market infrastructure; its first round of fundraising will be completed next month.

A stellar team of investors: spanning traditional venture capital, crypto venture capital, prediction markets, and traditional sports betting platforms.

Aside from confirmed investors Tarek Mansour, CEO of Kalshi, and Shayne Coplan, CEO of Polymarket, who did not give a direct response, 5c(c) Capital's other investors can be described as a "dream team"—including seasoned venture capitalists like Marc Andreessen of A16z (who invested through the Moneta Luna fund), as well as industry veterans such as Micky Malka, founder of Ribbit Capital, and Kyle Samani, former managing partner of Multicoin Capital. They even include investment managers from Millennium, a hedge fund with over $70 billion in assets under management, and the founder of the prediction market platform PredictIt, among other industry insiders and outsiders.

If the above list of investors reflects primarily the interests of venture capital firms, then the actions of the following two investors can be described as driven by "industry demand," similar to those of Polymarket and Kalshi. It is understood that the names of Jeremy Levine, CEO of the fantasy sports platform Underdog, and Jacob Fortinsky, CEO of the sports prediction platform Novig, are also prominently featured on the list.

It's clear that while the industry is developing rapidly, prediction market platforms and even traditional sports betting platforms are trying every means to solidify their foundation for development.

Ambitions for new funds predicting market growth: Future industry trading volume could reach $10 trillion

It's worth noting that the two founders of 5c(c) Capital mentioned two key pieces of information in this investment document:

Firstly, the two explicitly stated, "We hope to use our self-built (product platform) to create more secondary, tertiary, and even quaternary effects ." It is not difficult to see from their words that they are not only targeting primary investment at the level of building the prediction market platform, but also capital investment, risk management, equity transactions, and even liquidity attraction and inflows and outflows at more levels in various sub-sectors generated by the prediction market platform.

Secondly, regarding the future development of the industry, the document states that " currently, the forecasting market seems to be limited to the sports sector, but this is only a part of the industry , and the future trading volume of the industry may reach 10 trillion US dollars."

Putting aside other factors, Kalshi's recent platform operation data might provide some evidence: as of March 22 , Kalshi's monthly nominal trading volume had exceeded $9 billion. At this rate, Kalshi's March trading volume will exceed $12.7 billion, a 21.5% increase month-over-month. For comparison, Kalshi's annual nominal trading volume for 2025 is approximately $23.8 billion, meaning that in just one month (March alone), Kalshi's trading volume will reach approximately 53.4% ​​of last year's total trading volume. Furthermore, last October, the overall market trading volume was predicted to be around $10 billion; now, Kalshi's single-platform trading volume has already surpassed that figure.

Previously, Odaily Planet Daily had predicted in several articles that the prediction market would become another trillion-dollar industry independent of the cryptocurrency market, and now it seems that this prediction is gradually becoming a reality.

Prediction markets are breaking away from the crypto market to form an independent ecosystem: funds, industry alliances, data services, APIs, etc., form a closed loop.

With AI becoming a major driving force in the global economic system, prediction markets have emerged as another rare and rapidly growing sector, and their closed-loop ecosystem is rapidly improving.

Aside from the industry fund mentioned above that raised $35 million, the market prediction industry is gradually filling in its own underlying infrastructure, industry organizations, and application platforms.

In December of last year, Coinbase announced the acquisition of The Clearing Company, a prediction market platform founded by former employees such as Kalshi and Polymarket. Although the specific amount of the acquisition was not disclosed, the company had previously completed a $15 million seed round of financing and was one of the rapidly growing challengers in the industry.

Around the same time, five well-known organizations—Kalshi, Crypto.com, Robinhood, Coinbase, and Underdog— jointly announced the formation of the Coalition for Prediction Markets (CPM). Recommended reading : "Kalshi Allies with Coinbase, Robinhood, and Others, Aiming to End the 'Casino Theory' . "

Late last year, Tarek Mansour, co-founder and CEO of Kalshi, called for the inaugural Prediction Market Conference to be held in March 2026. At the conference, researchers, economists, policymakers, and traders will gather to discuss core issues surrounding prediction markets and knowledge aggregation.

In February of this year, Polymarket officially announced its second acquisition, acquiring Dome, a prediction market API startup. Dome , a Y Combinator Fall 2025 incubator, provides a unified prediction market API, helping developers build applications, trading bots, and data dashboards that can connect to multiple platforms such as Polymarket and Kalshi. Dome had previously received $500,000 in investment from Y Combinator and completed a $4.7 million seed round. Its first official acquisition was the acquisition of QCEX, a licensed US derivatives exchange, which enabled its successful return to the US market.

As industry transaction volume continues to grow, data analysis platforms targeting prediction market platforms are springing up like mushrooms after rain, including Parity , Predictefy , and KalshiData.

In addition, there are countless on-chain trading tools and AI agent trading tools available for Polymarket, such as Insiders.bot , Hubble AI , and AgentCard launched by Alchemy.

It is no exaggeration to say that the entire market, from upstream to downstream, is currently brimming with investment and entrepreneurial opportunities. We will gradually explore these opportunities in our " Crypto Bear Market Entrepreneurship Guide " series of articles.

The trend is set; let's wait for the flowers to bloom.

Previously, Kalshi held the top spot in market capitalization among prediction market platforms with a valuation of $22 billion, surpassing many traditional sports betting platforms such as FanDuel (also known as Flutter, $19 billion), DraftKings ($12.75 billion), and bet365 ($12 billion).

Furthermore, CFTC Chairman Mike Selig has previously stated that prediction markets can become "truth machines," and that he is developing regulatory rules and recruiting relevant talent for them . Therefore, prediction markets are no longer a niche sector within the crypto market, but have become a major benchmark emerging industry in the golden age of the US financial market .

Despite reports that U.S. lawmakers will introduce a bipartisan bill to ban prediction markets like Polymarket and Kalshi from making sports predictions, this is yet another example of prediction markets moving from the margins to the mainstream .

After all, the fact that over 36% of American voters are users of prediction market platforms cannot be ignored, and the ever-increasing trading volume data of prediction market platforms such as Kalshi and Polymarket does not lie.