Adds background, CEO comments in paragraphs 5 and 6, details in paragraph 5

May 7 (Reuters) - Prediction market platform Kalshi said on Thursday it had raised $1 billion in its latest funding round that valued the company at $22 billion, as institutional investors increasingly adopt event-based trading contracts.

The round was led by Coatue, with participation from Sequoia Capital, Andreessen Horowitz, IVP, Paradigm, Morgan Stanley, and ARK Invest.

Venture capital firms have poured money into late-stage startups, helping these companies remain private for longer and avoid the public market fluctuations seen last year and in early 2026.

Kalshi said it plans to use the proceeds to expand its offerings to promote adoption among hedge funds, asset managers, proprietary trading firms, and insurance companies.

Over the past six months, institutional trading volume has increased 800%, the company said.

Platforms such as Kalshi and rival Polymarket allow users worldwide to trade binary contracts on outcomes in politics, sports, economics and entertainment. The model has drawn strong backing for its event‑based trading and risk management approach.

"There are few categories in recent history that have scaled this quickly outside of AI," said Kalshi CEO Tarek Mansour.

"Event contracts could become a trillion-dollar market, and we're still in the early stages of that transition."