Meta Explored Buying Kalshi Before Building Prediction App
Before Meta CEO Mark Zuckerberg directed his team to build a standalone prediction market app, he proposed acquiring Kalshi, the leading platform in the booming prediction market sector, according to NPR. Zuckerberg met with Kalshi CEO Tarek Mansour in 2025 to discuss a potential takeover, but the informal talks never advanced beyond an initial discussion.
The Failed Acquisition Talks
The meeting between Zuckerberg and Mansour took place last year as Kalshi’s popularity was surging, according to three people with knowledge of the discussions who were not authorized to speak publicly. No formal offer was ever made, and competing narratives have emerged about why the deal fell apart.
Some sources say Mansour was unwilling to sell, while others indicate Meta had concerns about the legal and ethical questions surrounding Kalshi’s real-money gambling operations. The truth likely involves elements of both: Kalshi’s valuation was skyrocketing — from $2 billion in mid-2025 to $22 billion by March 2026 — giving Mansour little incentive to sell at a pre-boom price, while Meta’s cautious approach to real-money wagering suggests genuine regulatory concerns.
Neither Meta nor Kalshi provided comment to NPR about the acquisition talks.
Meta’s Alternative: Arena
Instead of acquiring Kalshi, Meta is building its own prediction market app called “Arena,” as previously reported. Unlike Kalshi and its main competitor Polymarket, Arena will not use real money. Users will wager “play money” on the outcome of news events and trending topics, with Meta’s AI systems — powered by Llama — determining the results.
This approach allows Meta to sidestep the complex regulatory landscape that Kalshi and Polymarket navigate daily. Kalshi is regulated by the Commodity Futures Trading Commission (CFTC) as a designated contract market, while Polymarket operates overseas outside U.S. regulatory reach. The industry faces dozens of legal battles pitting tech companies against state gaming officials who argue the sites constitute gambling. Minnesota became the first state to ban prediction markets in May 2026.
Meta previously attempted a similar concept with “Forecast” in 2020, a crowdsourced prediction market app that was shut down in 2022. Arena is described internally as “experimental but a top priority,” suggesting stronger executive commitment this time around.
The Prediction Market Boom
Prediction markets have become one of the fastest-growing sectors in tech. Monthly trading volume on Kalshi and Polymarket surged from approximately $28 billion in June 2025 to nearly $220 billion in June 2026, driven primarily by sports-related betting, according to data from The Block.
Kalshi’s valuation has grown 11x in roughly one year. After raising a $1 billion Series F round led by Coatue at a $22 billion valuation in March 2026, Mansour confirmed the company is considering an IPO, though it won’t happen this year. Polymarket is valued at $10.7 billion.
Meta, meanwhile, has ample financial firepower. The company ended the first quarter with $81.59 billion in cash on hand — more than six times Polymarket’s private market valuation, as Casino.org noted.
A Familiar Pattern
Zuckerberg’s interest in acquiring Kalshi follows a well-documented corporate strategy. Meta has amassed a user base of more than 3 billion worldwide through the acquisition of emerging competitors — most notably Instagram in 2012 and WhatsApp in 2014. The Federal Trade Commission alleged at a 2025 antitrust trial that Meta engages in a “buy or bury” strategy, in which nascent rivals are either acquired or cloned. A judge sided with Meta in November 2025, but the FTC is appealing the decision.
Tim Wu, a Columbia Law professor and former Biden White House tech policy adviser, offered a blunt assessment. “Meta seems to clutch at every shiny object,” Wu told NPR. “With the help of their advertising cash cow, they’ve been able to fail again and again without consequence.” He added that “WhatsApp and Instagram have given them never-ending profits, but normal companies cannot fail five times in a row.”
What’s Next
Meta has already struck a partnership with Kalshi in March 2026, allowing integration of Kalshi markets on its Threads app — a relationship that could coexist alongside Arena. Whether a play-money prediction market can sustain user engagement remains an open question, but Meta’s distribution advantage of over 3 billion users gives Arena a massive potential reach.
With the Supreme Court agreeing to hear a case about prediction markets and the DOJ pursuing insider trading cases in the sector, the regulatory landscape remains fluid. Meta’s entry — even with play money — validates the prediction market sector and could accelerate mainstream adoption, while also potentially drawing renewed antitrust scrutiny.