Meta reportedly explored acquiring prediction market platform Kalshi before deciding to build its own prediction market application.
According to people familiar with the discussions, Meta CEO Mark Zuckerberg met with Kalshi founder and CEO Tarek Mansour last year to discuss a potential acquisition as interest in prediction markets accelerated. The talks remained at an early stage and ultimately did not lead to a deal.
Sources cited differing reasons for the outcome, with some suggesting Kalshi had little interest in selling during a period of rapid growth, while others said Meta became more cautious because of the sector’s regulatory and legal uncertainties.
Arena Targets Virtual Prediction Markets
Meta has continued pursuing the prediction market space through the development of a standalone application reportedly named Arena.
Internal documents reviewed by NPR indicate the platform will focus on virtual predictions rather than real-money wagering. Users would make predictions on news, sports, entertainment, and cultural events, while Meta’s artificial intelligence systems generate questions, manage markets, and determine outcomes based on real-world events.
Neither Meta nor Kalshi has publicly commented on the reported acquisition discussions.
Prediction Markets Continue Rapid Growth
Prediction markets have become one of the fastest-growing segments of digital finance and online entertainment.
Industry data shows combined monthly trading volume on Kalshi and Polymarket increased from approximately $28 billion in June 2025 to nearly $220 billion one year later, with sports-related markets driving much of the growth.
The expansion has also boosted company valuations. Kalshi reportedly reached a valuation of $22 billion in its latest funding round, while Polymarket is estimated to be worth approximately $10.7 billion.
Regulation Remains a Key Challenge
Prediction market platforms continue to face increasing regulatory scrutiny despite their rapid growth.
Several US state gaming regulators argue these platforms resemble gambling products, while federal authorities continue examining issues such as insider trading and market manipulation. Investigations involving activity on Polymarket have further highlighted the regulatory challenges surrounding the sector.
Despite these concerns, the industry continues to attract investment and commercial interest as operators expand into new categories.
Meta Expands Through Partnership
Meta has frequently entered emerging markets through acquisitions, including Instagram and WhatsApp, although regulators have closely examined that strategy in recent years.
Instead of acquiring Kalshi, Meta later established a commercial partnership allowing Kalshi’s prediction markets to integrate with Threads, Meta’s social media platform.
The reported development of Arena suggests Meta remains committed to prediction markets, although its virtual points model differs from the real-money approach used by established platforms. Whether users embrace a non-monetary prediction experience remains uncertain, but Meta’s continued investment signals growing confidence that prediction markets will become an increasingly important part of online engagement.
