'Existential Threat': Prediction Market Firms Pour $5M Into Politics as Regulators Close In

The US Capitol, where lawmakers face growing pressure to clarify rules governing prediction markets and their political influence (Credit: Rebecca Lessner / Wikimedia Commons CC BY-SA 4.0)

Prediction market operators Kalshi and Polymarket, alongside their founders, have contributed at least $5 million (£3.7 million) to political groups during the 2026 US election cycle. Their spending comes as state authorities challenge the legality of some event contracts and federal regulators consider how the products should be governed.

More than a third of the reported contributions went to state-level political groups backing candidates for governor, attorney general, and state legislatures. These races could prove consequential for an industry whose ability to operate depends not only on federal oversight, but also on how individual states enforce their gambling laws.