Prediction market operator Kalshi confirmed Thursday that it has ended its paid advisory contract with Donald Trump Jr. The separation, first reported by Reuters, stems from an investment conflict involving Kalshi's primary competitor, Polymarket. Negotiations regarding his formal departure began in August after Trump Jr.'s venture capital firm, 1789 Capital, announced a major strategic investment stake in Polymarket. A Kalshi spokesperson described the exit as a mutual arrangement between both parties. Both sides agreed that retaining the president's son as a paid adviser created a direct conflict of interest while he served as a top investor in rival Polymarket through 1789 Capital. Neither CNBC nor CoinDesk disclosed the exact dollar size of 1789 Capital's investment in the competing platform.
Trump Jr. had previously worked with Kalshi as a paid strategic adviser to help expand its retail customer base and promote event-contract trading across digital platforms. Earlier this year, 1789 Capital announced a major stake in Polymarket, placing him in an awkward position across rival exchanges. Kalshi issued a brief public statement cited by CoinDesk: "We are grateful for his contributions in helping us market Kalshi to more customers, and both sides agreed that ending the advisory arrangement was appropriate given his involvement with a competing platform."
The contract termination comes immediately after competitive midterm elections that drove massive trading volume across prediction markets, where platforms including Kalshi and Polymarket allow users to trade contracts tied to real-world political elections, economic releases, and sporting outcomes. Several US state attorneys general and gaming commissions have filed civil lawsuits against both Kalshi and Polymarket, alleging that the event-contract platforms violate state gambling laws by operating without local gaming licenses. Both companies contend that their federally regulated event contracts fall strictly under Commodity Futures Trading Commission oversight rather than state wagering statutes.
