Kalshi and Trump Jr. part ways after his firm's Polymarket bet

What happened

Kalshi has confirmed that Donald Trump Jr. no longer advises the prediction market, after the two sides agreed to end the arrangement. A Kalshi spokesperson tied the decision to the investment his venture firm, 1789 Capital, made in Polymarket, Kalshi's largest competitor. "We have mutually agreed to end Don's advisory role after his firm's significant investment in a competitor this past summer," the spokesperson said, adding that the company was grateful for his help marketing Kalshi to more customers.

The parting was reported first by Bloomberg and subsequently by Reuters, the Associated Press, CNBC, the Financial Times and Unchained, among others. According to the AP, the two sides began discussing a split in August, when 1789 Capital increased its stake in Polymarket. A person familiar with the matter told the FT that Kalshi initially allowed Trump Jr. to keep advising a rival, but the arrangement was later judged unworkable. Kalshi and Trump Jr. both saw the dual role as a conflict, a Kalshi spokesperson said, according to CNBC.

Trump Jr. has not cut his ties to Polymarket. CNBC reported that he continues to serve on its advisory board, which he joined in August 2025, when 1789 Capital made its first investment in the platform. Polymarket and Trump Jr. did not immediately respond to requests for comment from Reuters, and Kalshi did not respond to Unchained's inquiry.

Why it matters

The separation removes one of Kalshi's most visible connections to the president's family at a moment when those connections are drawing congressional attention. Democrats won both chambers of Congress in the Nov. 3 midterms, and Sen. Elizabeth Warren is expected to take control of the Senate Banking Committee in January. An aide told Politico that Trump family crypto businesses and prediction markets are among her early oversight targets, while the AP reported that Democrats intend to examine the family's links to both Kalshi and Polymarket. Rep. Robert Garcia, the leading Democrat on the House Oversight Committee, has also named the family's business activities as a potential investigative priority.

Both companies have rejected any suggestion that their financial ties to the Trumps influenced how the administration regulated the sector. Kalshi CEO Tarek Mansour said in early October on MS NOW, formerly MSNBC, that Trump Jr.'s ties presented an "optics issue," though he said the company had never used them to curry favor with the government.

What the data shows

According to crypto.news, 1789 Capital committed about $300 million toward a $1 billion Polymarket funding round, on top of an earlier commitment of roughly $200 million, bringing its combined pledges to around $500 million. The planned financing was reported to value Polymarket at $21 billion, up from close to $15 billion beforehand; the figures described planned commitments rather than a final ownership percentage. Kalshi, by contrast, reached a $40 billion valuation in late October after a $1 billion funding round, a roughly 20-fold increase according to the FT.

Federal enforcement has also touched the sector. In late August, the CFTC settled charges against Gabriel Perez, a former White House teleprompter operator accused of using advance access to presidential speeches to trade mention contracts between December 2025 and February 2026. He was ordered to return $107,539.02 in trading profits, pay a $65,000 civil penalty and accept a three-year trading ban; the agency credited KalshiEX with assisting the investigation.

Background

Kalshi named Trump Jr. a strategic adviser in January 2025, days before his father's second inauguration, in a role the company described as covering market strategy, growth, partnerships and new audiences. He was granted roughly $300,000 in equity, a stake the FT reported has since been heavily diluted by new share issuance, and Kalshi declined to comment to the FT on its current status. The departure reports did not say what would happen to the equity.

The two platforms operate in an industry where federal market oversight and state gambling law are in open dispute. Kalshi argues that event contracts on CFTC-registered exchanges fall under the agency's jurisdiction, while state authorities have challenged products they consider unlicensed gambling. In late July, a Minnesota federal court blocked enforcement of a state prediction market statute against CFTC-registered exchanges while related lawsuits proceed, granting preliminary relief to the federal government, the CFTC, Kalshi and Polymarket US. The CFTC has also warned about contracts settled by whether named people say certain words or attend events, citing heightened manipulation risk.

What to watch

Sens. Warren and Jeff Merkley have pressed Trump Jr. over his financial and advisory ties to prediction platforms, demanding answers from the White House by Nov. 23, Bitcoin.com reported. Separately, the CFTC issued guidance on Nov. 5 directing federally regulated prediction exchanges to remove state-specific trading restrictions within 30 days or explain why they cannot comply, a directive that followed court orders limiting Kalshi's activities in some jurisdictions. How Congress and the courts treat the industry's federal-versus-state dispute, and whether the family's remaining Polymarket ties face further scrutiny, are the open questions.

Questions readers ask