Meta Platforms is weighing potential partnerships with prediction-market operators Polymarket and Kalshi, according to a New York Times report, even as the company simultaneously builds its own competing app internally codenamed Arena. Chief Executive Mark Zuckerberg has asked company executives to evaluate possible collaborations with the two platforms, according to three employees familiar with the discussions. The development marks the second sign within a week of Meta's deepening interest in the prediction-market space, a sector that lets users trade contracts tied to the outcomes of political, financial, and sporting events.

The partnership talks come just days after reports that Zuckerberg had assembled a development team working on an experimental standalone app, internally called "Arena," through which users would be able to weigh in on the outcomes of sporting events, political contests and other questions. Unlike Polymarket and Kalshi, the Meta platform would not involve cash wagers, at least initially, instead employing a points system reminiscent of a video game. Meta has not ruled out adding financial mechanisms that use real cash down the line after launch. Zuckerberg's team is reportedly aiming for at least 100 million monthly active "predictors," with the app targeting users between 18 and 34 years old, and plans call for eventually integrating parts of Arena into Facebook and Messenger.

The structural differences between Arena and its potential partners are notable. Polymarket operates its markets via USDC settlements on the Polygon blockchain, while Kalshi operates as a CFTC-regulated exchange using cash. Kalshi has operated as a Commodity Futures Trading Commission-designated contract market since 2020, while Polymarket says its United States business also uses a CFTC-regulated designated contract market. Pursuing a partnership alongside internal development suggests Meta is keeping multiple paths open rather than committing exclusively to a build-it-yourself strategy.

Meta would not be breaking new ground in linking up with an established prediction-market operator. X named Polymarket as its official prediction-market partner in June 2025, embedding live market probabilities and Grok-powered annotations alongside posts. A Meta deal, however, could carry far greater reach given the size of its user base. Meta's Family of Apps reached 3.56 billion daily active people in the first quarter of 2026, according to the company's earnings report. Notably, this comes as Meta's daily active user count slipped quarter-over-quarter for the first time in that period, a decline the company attributed to internet disruptions in Iran and a restriction on WhatsApp access in Russia.

The timing also reflects explosive growth in the prediction-market industry itself. Combined trading volume on Polymarket and Kalshi reached almost $50 billion in 2025 and has already surpassed $130 billion so far in 2026, according to Binance Square figures. Kalshi's valuation has climbed accordingly: the company raised $1 billion at a $22 billion valuation in May and is reportedly seeking a $40 billion valuation in a new funding round. Institutional market makers, including Wintermute, have also stepped in to provide liquidity to the two platforms. Analysts see room for further expansion: Bernstein analysts have estimated prediction markets could reach $1 trillion in annual volume by 2030.

News of Meta's interest has already rippled through adjacent industries. Shares of DraftKings dropped more than 2%, while Flutter Entertainment, the parent company of FanDuel, fell nearly 2% before a partial recovery. Robinhood, which already offers Kalshi markets on its platform, also declined. The market reaction underscores how a major entrant like Meta could reshape competitive dynamics across both the regulated betting industry and the broader prediction-market ecosystem.

Regulatory and legal questions continue to shadow the sector as it scales. Prediction markets have drawn scrutiny over accusations of insider trading, including instances of politicians betting on their own races. In one widely cited case, Kalshi reported former New York Congressman George Santos to federal prosecutors after he said he would attend President Trump's State of the Union address in February before betting against his own attendance. Separately, the U.S. Department of Justice said in April that a special operations officer used classified knowledge to net $400,000 on a prediction market tied to the future of Venezuelan President Nicolás Maduro, who was captured by U.S. forces on January 3. A number of U.S. states have passed or are considering restrictions on election-related wagers, a regulatory backdrop that any Meta partnership would need to navigate. It is also worth noting that Meta briefly operated its own prediction platform, called Forecast, from 2020 to 2022 before shutting it down due to low usage — a precedent that adds context to the company's renewed, and apparently more ambitious, attempt at the category.

As of this writing, neither Polymarket nor Kalshi has issued a public statement on the reported discussions, and Meta has made no formal partnership announcement. The talks remain exploratory, and it remains unclear whether Meta will ultimately pursue a standalone platform, a distribution partnership, or some combination of both.

Key Takeaways

Meta is exploring partnerships with Polymarket and Kalshi while separately developing its own points-based prediction app, Arena, targeting 100 million monthly users aged 18-34.
Combined Polymarket and Kalshi trading volume has already topped $130 billion in 2026, up from roughly $50 billion in all of 2025.
A Meta partnership would dwarf X's existing Polymarket tie-up in scale, given Meta's 3.56 billion daily active users across its Family of Apps.
News of Meta's prediction-market ambitions has pressured shares of DraftKings, Flutter Entertainment, and Robinhood.
No formal agreement has been reached; Polymarket, Kalshi, and Meta have all declined to comment publicly, and the talks remain in early, exploratory stages.

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