Author｜Wenser, Odaily Planet Daily

Behind the steadily rising trading volume of prediction markets, its ecosystem is also rapidly expanding.

Yesterday, the venture capital firm 5c(c) Capital, founded by two former Kalshi employees, announced its latest fundraising plan, aiming to raise $35 million for investments in prediction market-related startups. Notably, the firm has garnered support from Kalshi CEO Tarek Mansour and Polymarket CEO Shayne Coplan, among others, including individuals from a16z, Ribbit Capital, and Multicoin Capital.

At the same time, this firm is not only the first venture capital institution focused on investing in the prediction market industry but also the same entity that has garnered investments from the two giants of prediction markets, Kalshi and Polymarket, marking it as an “industry first.” Coupled with previous news about Kalshi's establishment of a prediction market alliance, plans for a prediction market conference, Polymarket’s opening of LP market-making incentives, and the plethora of various prediction market data platforms emerging in the market, the prediction market is gradually separating from the native cryptocurrency market and increasingly becoming an independent emerging industry ecosystem.

When a sector sees its trading volume multiply by dozens in just one year, and when a platform's monthly trading volume matches that of the entire industry a few months ago, the prediction market is aggressively encroaching on the traditional betting platform territory.

Polymarket CEO Invests in Kalshi's Former Employees: A Common Choice by the Titans of Prediction Markets

It is understood that the name of 5c(c) Capital is derived from a provision in the U.S. Commodity Exchange Act regarding prediction markets.

The two founders are veteran figures from Kalshi — Adhi Rajaprabhakaran served as the No. 2 trader in the Kalshi related market-making department, Kalshi Trading, and is also the creator of the well-known prediction market podcast “50 Cent Dollars”; Noah Zingler-Sternig served as the Operations Lead (similar to COO) at Kalshi and was involved in Kalshi's integration with Robinhood Markets Inc.

Additionally, the fund plans to invest in about 20 companies over the next two years, focusing on market makers, index design, and other foundational aspects of prediction market infrastructure; its first round of fundraising is expected to be completed within the next month.

Impressive Investor Lineup: Spanning Traditional Venture Capital, Crypto Venture Capital, Prediction Markets, and Traditional Sports Betting Platforms

Aside from confirmed support from Kalshi CEO Tarek Mansour and unconfirmed responses from Polymarket CEO Shayne Coplan, the other investors in 5c(c) Capital can be deemed an “impressive lineup” — including venture capital veterans like A16z’s Marc Andreessen (investing through the Moneta Luna fund), as well as industry veterans like Ribbit Capital’s founder Micky Malka and former Multicoin Capital managing partner Kyle Samani, and even investment managers from the hedge fund Millennium, which manages over $70 billion in assets, along with the founder of the prediction market platform PredictIt.

If the above investor list primarily reflects the interests of venture capital firms, then the actions of the next two participants can be seen as similar to “industry demand behavior” like that of Polymarket and Kalshi. Notably, Underdog CEO Jeremy Levine and Novig CEO Jacob Fortinsky are also on the list.

It is evident that as the industry rapidly develops, prediction market platforms and even traditional sports betting platforms are exploring every possible way to solidify their foundational growth.

The Ambition of the New Prediction Market Fund: Future Industry Trading Volume Could Reach $10 Trillion

It is worth mentioning that the two founders of 5c(c) Capital highlighted two key pieces of information in this investment document:

Firstly, they clearly stated, “We hope to use the (product platform) we built to create more secondary, tertiary, and even quaternary effects.” It is apparent that their aim is not just primary investment in building prediction market platforms, but also capital investments in various segmented tracks generated by the prediction market platform, risk management, equity trading, and attracting liquidity across more levels.

Secondly, concerning the future development of the industry, the document pointed out, “Currently, prediction markets seem limited to the sports sector, but this is just a part of the industry; in the future, the industry’s trading volume could reach $10 trillion.”

Without elaborating further, the recent operational data from Kalshi might serve as evidence: As of March 22, Kalshi's monthly nominal trading volume has exceeded $9 billion. At this rate, Kalshi’s trading volume in March is expected to exceed $12.7 billion, a month-on-month increase of 21.5%. In comparison, Kalshi's projected annual nominal trading volume for 2025 is approximately $23.8 billion, meaning that just within one month (March alone), Kalshi’s trading volume will reach about 53.4% of last year’s total trading volume. Furthermore, last October, the overall trading volume of the prediction market industry was about $10 billion, whereas now, Kalshi’s single platform trading volume has already surpassed that figure.

Previously, Odaily Planet Daily had predicted in several articles that the prediction market would become another trillion-dollar industry track independent of the cryptocurrency market, and it seems this prediction is gradually becoming a reality.

Prediction Markets Evolving Beyond Crypto Market into Independent Ecosystem: Funds, Industry Alliances, Data Services, APIs, etc., Are Forming a Closed Loop

As AI becomes a significant driving force in the global economic system, prediction markets represent another rare rapidly growing track, and its closed-loop ecosystem is also rapidly improving.

Beyond the aforementioned industry fund targeting $35 million in fundraising, the prediction market industry is piecing together its own foundational infrastructure, industry organizations, and application platforms.

In December last year, Coinbase announced the acquisition of The Clearing Company, a prediction market platform founded by former employees of Kalshi and Polymarket; although the specific acquisition amount was not disclosed, the company had previously completed a $15 million seed round of financing, making it one of the strong challengers in the industry.

During the same period, renowned institutions Kalshi, Crypto.com, Robinhood, Coinbase, and Underdog jointly announced the establishment of the Coalition for Prediction Markets (CPM). Recommended Reading“Kalshi Forms Alliance with Coinbase, Robinhood, etc., Aiming to End the ‘Casino Theory’”.

At the end of last year, Kalshi CEO co-founder Tarek Mansour called for the first Prediction Market Conference to be held in March 2026, where researchers, economists, policymakers, and traders will discuss core issues surrounding prediction markets and knowledge aggregation.

In February of this year, Polymarket officially announced its second official acquisition, stating it would acquire the prediction market API startup Dome, which is a Y Combinator Fall 2025 incubated project that provides a unified prediction market API to help developers build applications, trading bots, and data dashboards that can connect with multiple platforms like Polymarket and Kalshi. It had previously received $500,000 in investment from Y Combinator and completed a $4.7 million seed round. Its first official acquisition was aimed at the licensed derivatives exchange QCEX, allowing it to smoothly return to the U.S. market.

As the industry trading volume continues to grow, data analysis platforms targeting prediction market platforms are emerging one after another, including: Parity, Predictefy, and KalshiData.

In addition, numerous on-chain trading tools for Polymarket and AI Agent trading tools have also emerged in abundance, such as Insiders.bot, Hubble AI, and Alchemy’s AgentCard.

It is not an exaggeration to say that the upstream, midstream, and downstream of prediction markets are currently rife with investment and entrepreneurial opportunities. In the future, we will also gradually discuss these topics in the series of articles titled “Crypto Bear Market Entrepreneurial Guide”.

The Trend is Set, Waiting for Blossoming

Previously, Kalshi held a valuation of $22 billion, standing at the top of the prediction market platform valuations, surpassing many traditional sports betting platforms like FanDuel (also known as Flutter, $19 billion), DraftKings ($12.75 billion), and bet365 ($12 billion).

Moreover, U.S. CFTC Chair Mike Selig has stated that prediction markets can become “truth machines” and regulatory rules are being developed for them along with the recruitment of relevant talents. Thus, it can be observed that prediction markets have long ceased to be a niche track within the cryptocurrency market, but rather have become a significant benchmark emerging industry in the golden age of the American financial market.

Despite reports that U.S. legislators may propose a bipartisan bill banning prediction markets like Polymarket and Kalshi from making sports event predictions, this is yet another example of how prediction markets are moving from the fringes to the mainstream.

After all, the fact that over 36% of American voters are users of prediction market platforms cannot be ignored, and the consistently rising trading volume data for platforms like Kalshi and Polymarket simply cannot be deceived.

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