NYSE Owner ICE Invests $2 Billion in Polymarket at Valuation of Up to $10 Billion
After Intercontinental Exchange (NYSE: ICE) invested $2 billion, the valuation of prediction markets operator Polymarket increased to $10 billion.
Shayne Coplan's company and the owner of the New York Stock Exchange came to an arrangement whereby the latter will invest $2 billion in the event contract purveyor at a premoney valuation of $8 billion. Polymarket is currently valued between $9 billion and $10 billion on a post-investment basis, supporting the veracity of claims that appeared last month that the company was trying to seek funds in that price range.
"Alongside its investment, ICE will become a global distributor of Polymarket’s event-driven data, providing customers with sentiment indicators on topics of market relevance. Additionally, ICE and Polymarket have also agreed to partner on future tokenization initiatives,” according to a statement.
According to ICE, its cash investment in Polymarket won't have an impact on the exchange operator's 2025 financial results or its intentions to return capital to shareholders. The financial services company stated that when it releases its third-quarter results on October 30, it would go into more detail about its investment in Polymarket.
In just four months, Polymarket's valuation has increased at least ninefold
Even if ICE invested "just" $9 billion in Polymarket, that is an incredible increase in just a few months.
Direct rival Kalshi raised $2 billion after completing a $185 million Series C investment round in June. At about the same time, Polymarket completed a $1 billion capital raise. In October, Polymarket's value has increased by at least nine times over the previous four months.
That increase has taken place despite Polymarket's continued lack of US business authorization, which means it is losing out on the opportunity to offer football event contracts to potential customers in this nation. Rival Kalshi has benefited greatly from those contracts, which have resulted in a string of record-breaking volume on that prediction market. Polymarket has been tantalizing football bets in recent days and is anticipated to reopen in the US soon.
Kalshi, which was valued at $2 billion in June, is reportedly considering further funding that would raise its valuation to $5 billion.
The distinction between financial markets and predictions is becoming increasingly hazy
Hedge funds and other professional investors are some of the most active players in prediction markets. The idea that professionals are risking their own money and reputations by making trades on yes/no exchanges like Kalshi and Polymarket is one of the reasons why some traders and ordinary investors swear by the accuracy of prediction markets.
The distinction between traditional finance and derivatives—which some analysts compare directly to sports wagers—is becoming increasingly hazy as a result of the ICE/Polymarket merger. Flutter Entertainment's (NYSE: FLUT) FanDuel and CME Group (NASDAQ: CME) announced in June that they would collaborate on event contracts linked to financial assets, economic events, and equity index prices. The CME/FanDuel contracts will be timed and seem to be the sports betting equivalent of microbetting.
“Our partnership with ICE marks a major step in bringing prediction markets into the financial mainstream,” said Coplan in the statement.
Among the investors in Polymarket are Vitalik Buterin, co-founder of Ethereum, Donald Trump Jr., and Peter Thiel's Founders Fund. In August, Trump Jr.'s 1789 Capital firm invested several million dollars in Polymarket. He is an advisor at Polymarket and Kalshi.
