Kalshi ends Trump Jr. advisory role over Polymarket conflict
Prediction market Kalshi ended Donald Trump Jr.'s advisory contract after his firm 1789 Capital raised its stake in rival Polymarket, a split both sides call mutual.
A conflict of interest, mutually ended
Prediction market platform Kalshi has ended its advisory contract with Donald Trump Jr. after his venture capital firm, 1789 Capital, increased its stake in arch-rival Polymarket, according to a Kalshi spokesperson cited by CNBC and Reuters. Both sides agreed it was a conflict of interest to keep the president's son as an adviser while he served as a top investor in Polymarket, the spokesperson said.
Conversations about ending the contract began in August, after 1789 Capital led Polymarket's most recent funding round, Reuters reported. Kalshi described the decision as mutual, and thanked Trump Jr. for his contributions in helping market the platform to more customers.
From adviser to rival investor
Kalshi first named Trump Jr. a strategic adviser in January 2025, giving him a stake in the company that the Financial Times reported at the time was worth $300,000, according to Reuters. The arrangement lasted less than two years before his firm's growing bet on the rival platform made the dual role untenable.
Trump Jr. still serves as an adviser to Polymarket, CNBC reported. Kalshi, described by Reuters as a $40 billion prediction markets startup, raised $1 billion in a funding round that valued the company at $40 billion, Reuters reported in October, as it pushes beyond event contracts toward becoming a multi-asset trading platform.
- Kalshi valuation$40 billion
- Trump Jr. Kalshi stake (FT)$300,000
- Named Kalshi adviserJanuary 2025
- Exit talks beganAugust
- Still advisesPolymarket
Politics now in the frame
The exit comes after Democrats secured a majority in the House and the Senate, with the party expected to crack down on the prediction market industry, CNBC reported. Joseph Konizeski, a former trial attorney at the Commodity Futures Trading Commission, previously told CNBC that Trump Jr.'s ties to the industry could make prediction markets an easy target for lawmakers.
In early October, Kalshi chief executive Tarek Mansour said on MS NOW that Trump Jr.'s connection to the company creates an "optics issue," but added that it has never relied on that relationship to gain favor with the government. CNBC noted it has a commercial relationship with Kalshi that includes customer acquisition and a minority investment.
What to watch next
The question now is how far the expected Democratic crackdown goes, and whether it targets the platforms themselves or the trading around sensitive events. Prediction markets rose to prominence in 2024, when their odds diverged sharply from traditional opinion polls by signaling a Trump victory, and trading volumes have surged since.
For Kalshi, the split removes a political lightning rod as it expands into new products, including perpetual futures approved by the Commodity Futures Trading Commission in 2026, Reuters reported. For Polymarket, keeping Trump Jr. as an adviser means keeping the same political exposure Kalshi just walked away from.
