Bernstein: Kalshi, Polymarket May Become Takeover Candidates
Posted on: June 29, 2026, 11:45h.
Last updated on: June 29, 2026, 11:45h.
- Research firm says increased vertical integration in the prediction market industry could spark consolidation
- Kalshi, Polymarket lag in distribution, potentially making them acquisition targets
- Bernstein also sees possibility of large-scale sportsbook M&A
With vertical integration all the rage in the prediction market industry, a wave of consolidation could be afoot and that could include Kalshi and Polymarket becoming takeover targets.
That’s the view of Bernstein analyst Ian Moore and team who in a new report note that prediction market operators’ thirst for controlling both distribution and infrastructure could make Kalshi and Polymarket — the two largest yes/no exchanges — takeover targets in the future.
Kalshi and Polymarket own the stack but trail on distribution, which leaves each as plausibly a target as an acquirer,” wrote Moore.
Said another way, Kalshi and Polymarket are masters of the yes/no exchange concept and have the infrastructure to prove it, but those companies lack the distribution capabilities of emerging rivals such as Coinbase Global (NASDAQ: COIN), DraftKings (NASDAQ: DKNG) and Robinhood Markets (NASDAQ: HOOD), among others. As just two examples of distribution prowess, Coinbase has an estimated 9.2 million monthly transacting users while Robinhood as 27.6 million funded accounts.
Finding Buyers for Kalshi, Polymarket Is a Different Story
Moore acknowledges that as prediction market consolidation evolves and ramps up, it’s possible that Kalshi and Polymarket could be buyers or sellers.
If the latter proves accurate in either instance, it becomes a matter of locating credible buyers in the publicly traded space. Entering Monday, the combined market value of DraftKings and FanDuel owner Flutter Entertainment (NYSE: FLUT), also a prediction market player, was less than $30 billion. On the other hand, Kalshi finalized a $1 billion Series F funding round in March that valued it at $22 billion while Polymarket is valued at $15 billion.
Reports recently surfaced indicating Kalshi’s next capital raise could lead to a $40 billion valuation. The company also acknowledged it’s considering an initial public offering (IPO), but that won’t be a 2026 event.
The Bernstein analysts didn’t mention potential suitors for Kalshi or Polymarket, but given those companies’ private market valuations and the increasing intersection of prediction markets and consumer finance, it’s possible that if either of those operators are bought out, the buyer will hail from the financial services realm, not the gaming industry.
Sportsbook M&A Possible, Too
Moore and his team also point out that increased mergers and acquisitions activity could include sportsbook operators buying exchanges — as DraftKings did with Railbird, setting the stage for last week’s launch of DKeX — trading houses buying sportsbooks for distribution and trading reasons, and sportsbooks potentially merging.
Regarding sports betting consolidation, it’s likely DraftKings and Flutter would be buyers, not sellers. However, the pool of viable domestic targets for those operators is relatively shallow, though it could expand if some casino operators decide to part with their online units.
The Bernstein analysts said there’s a less than 5% chance DraftKings and FanDuel revisit a marriage. That transaction was halted in 2017 by the Federal Trade Commission (FTC), forcing the companies to scrap it.
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