Meta Held Talks to Acquire Kalshi Before Building Its Own Play-Money Prediction Market App Called Arena

Before directing his team to build an in-house prediction market application, Meta CEO Mark Zuckerberg explored buying Kalshi outright, according to a report from NPR citing people with direct knowledge of the discussions. Zuckerberg met with Kalshi CEO Tarek Mansour about a potential acquisition last year as Kalshi’s popularity surged, but the negotiations never advanced. Meta is now building its own prediction market product internally, a play-money app codenamed Arena that will allow users to make wagers on future events without using real cash.

The NPR reporting offers competing explanations for why the talks collapsed. Some sources told the outlet that Mansour was unwilling to sell the company he built; others said Zuckerberg decided Kalshi’s regulatory entanglements — which include ongoing legal battles with more than a dozen states — made the acquisition too risky. Neither Kalshi nor Meta provided comment to NPR when contacted about the discussions.

What Meta Is Building Instead

Rather than purchasing Kalshi, Meta assembled an internal team to build Arena, a standalone prediction market app designed to let users wager play money — not real cash — on the outcomes of news events and trending topics. Internal documents reviewed by NPR show Meta’s artificial intelligence systems will generate questions and determine winners based on real-world outcomes. Arena is positioned as a social engagement product rather than a financial one, which also sidesteps the regulatory scrutiny that has made Kalshi’s model so legally contentious.

Despite the failed acquisition talks, Meta and Kalshi did strike a commercial partnership in March, integrating Kalshi’s prediction markets into Meta’s Threads social media platform. That deal allows Threads users to see and interact with Kalshi markets directly within the app — a meaningful distribution advantage for Kalshi even without a full acquisition.

The Scale of Prediction Market Growth

The broader context for Meta’s interest in prediction markets is the industry’s explosive growth. Monthly trading volume on Kalshi and Polymarket climbed from approximately $28 billion in June 2025 to nearly $220 billion a year later — a figure driven overwhelmingly by sports-related contracts, particularly around major events like the World Cup. That trajectory has attracted attention from technology companies and investors alike.

Kalshi itself is reportedly in the midst of a funding round that could value the company at $40 billion. The company’s growth has come alongside intense regulatory pressure: a Michigan court issued a temporary restraining order against Kalshi on June 30, and the company now faces legal challenges in more than a dozen states that argue its sports event contracts constitute unlicensed online gambling.

For users of prediction market platforms, Meta’s entry — even in a play-money format — could dramatically expand mainstream awareness of the category. Arena’s social-first design would expose prediction market concepts to Meta’s billions of users across Facebook and Instagram in addition to Threads. Kalshi and Polymarket are the current market leaders for real-money prediction trading, and while Arena’s play-money model is fundamentally different, the attention it brings to the sector could accelerate adoption. For those already interested in event contract trading, DraftKings Predictions also offers a legal, regulated option in 18 states through its newly launched DKeX exchange. The convergence of major tech companies and established gambling operators into the prediction market space underscores how the industry’s extraordinary growth has made it impossible to ignore.