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Two major prediction market platforms, Kalshi and Polymarket, are reportedly targeting $20 billion valuations in upcoming fundraising rounds, according to a Wall Street Journal report. The news comes amid growing regulatory scrutiny, as lawmakers investigate suspiciously timed bets on U.S. and Israeli military actions against Iran. These bets, which preceded actual events, have raised concerns about potential insider trading and market manipulation in decentralized prediction markets. The development highlights the regulatory challenges facing crypto-native prediction markets, which operate in a legal gray area. U.S. lawmakers are now pushing for stricter oversight to prevent abuse, which could impact the growth trajectory of these platforms. Traders and investors are closely watching how regulators balance innovation with compliance, as the outcome may shape the future of decentralized financial markets. For the broader crypto market, this regulatory focus could either stifle innovation or lead to clearer frameworks that attract institutional investors. Key watchpoints include upcoming legislative proposals in the U.S. and how market participants adapt to evolving compliance requirements. The success of Kalshi and Polymarket’s fundraising will also signal investor confidence in the sector’s long-term viability.
