Prediction Market Innovators Secure $15M for New On-Chain Platform

A new prediction market platform, The Clearing Company, has secured $15 million in seed funding. The startup, founded by former employees of prominent prediction platforms Polymarket and Kalshi, aims to create an on-chain, permissionless, and regulated prediction market. The funding round was led by Union Square Ventures, with significant participation from Haun Ventures, Variant, and Coinbase Ventures, alongside several angel investors.

Key Takeaways

• The Clearing Company, founded by ex-Polymarket and Kalshi staff, raised $15 million in seed funding.

• The platform aims to build an on-chain, permissionless, and regulated prediction market.

• Union Square Ventures led the funding round, joined by major crypto investors.

Funding and Vision

The substantial seed funding round, totaling $15 million, was spearheaded by Union Square Ventures and included notable investors such as Haun Ventures, Variant, and Coinbase Ventures. This capital injection will fuel the development of The Clearing Company's innovative prediction market, which is designed to be decentralized, accessible, and compliant with regulations.

Toni Gemayel, formerly Head of Growth at both Polymarket and Kalshi, is at the helm as CEO, bringing valuable experience from the leading prediction market platforms. The company's vision is to usher in a new era for prediction markets, emphasizing simplicity, creativity, and enhanced liquidity. They believe that for prediction markets to scale effectively, they must be enjoyable to create, seamless to trade on, and supported by novel structures that unlock liquidity.

The Prediction Market Landscape

Prediction markets, which allow users to wager on future events such as elections or sports outcomes, have seen a resurgence in interest. Polymarket, for example, reported a significant increase in active traders in July. Kalshi is also expanding its reach, recently hiring a crypto influencer and partnering with Robinhood. The sector has attracted attention from high-profile figures, including Donald Trump Jr., who has taken advisory roles at both Polymarket and Kalshi.

Despite the growing enthusiasm, some industry figures, like Ethereum co-founder Vitalik Buterin, have raised concerns about the lack of interest-bearing mechanisms in many current prediction markets, deeming them unappealing for hedging purposes. The Clearing Company, however, highlights the historical importance of prediction markets as tools for aggregating information and understanding future outcomes, citing examples from Roman times and Wall Street's past engagement with election markets.

The Clearing Company is actively seeking engineers and designers to contribute to its mission of creating a more robust and accessible prediction market ecosystem.

Sources

• Ex-Polymarket, Kalshi Team Raises $15M for New Prediction Platform, The Crypto Times.

• Former Polymarket and Kalshi team raise $15m from Union Square and Coinbase to build an onchain,
  permissionless, and regulated prediction market., AInvest.

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