PitchBook Put a $30.4 Billion Price on Kalshi, and a $22.8 Billion Floor Under a Company That Could Lose 70 Per Cent of Its Fees

PitchBook started covering Kalshi this week the way it covers a company on the runway to an IPO, and the number it produced is $30.4 billion. Bear case $22.8 billion. Bull case $42.1 billion. The base is built off expected 2028 adjusted earnings; the model runs financials out to 2030, where senior research analyst Franco Granda has the exchange doing $6.4 billion of revenue and $3.7 billion of adjusted profit.

Set the headline number aside for a moment and look at the floor. Kalshi raised $1 billion in May at a $22 billion valuation. PitchBook's downside case is $22.8 billion. In other words, the worst outcome the model contemplates is that the people who wrote cheques four months ago get their money back with a rounding error attached.

That is a strange shape for a distribution on a company whose largest revenue line is the subject of two federal appellate decisions that contradict each other.

What the model says about concentration, in its own numbers

The report does not hide the dependency. Sports contracts are 69.9 per cent of Kalshi's event fees year to date. Include exotics and it is 82.4 per cent. Granda ran the sensitivity himself: cut sports and exotics fees by a quarter and the 2026 forecast loses $642 million, while 2030 loses $1.4 billion — better than a fifth of the revenue line in the year the whole valuation leans on.

A 25 per cent haircut is a reasonable thing to model. It is roughly what happens if a handful of large states successfully wall off sports event contracts and the rest hold. It is not what happens if the Supreme Court takes New Jersey's case and rules for New Jersey.

The diversification story the model tells is perpetual futures, and the numbers there are honest and small: $50.7 million of net transaction revenue in 2026, growing to $275.7 million by 2030. Real money. Also roughly four per cent of the 2030 revenue forecast. Perpetuals are not a hedge against losing sports. They are a second business that would be a nice business if the first one survives.

The legal facts the floor has to absorb

Here is what sits underneath that $22.8 billion.

The Third Circuit, in the Flaherty litigation, upheld an injunction stopping New Jersey from enforcing its gambling laws against Kalshi. On August 28 the Ninth Circuit went the other way in the Assad case, holding that state authority survives the Commodity Exchange Act, and disagreed with the Third Circuit's reasoning at length rather than distinguishing it. The same court told Kalshi it was unlikely to show that federal law preempts Nevada's licensing requirement, and ruled for Blue Lake Rancheria and Chicken Ranch Rancheria of Me-Wuk Indians on their claim that sports event contracts offered on tribal lands violate the Indian Gaming Regulatory Act.

On September 2, New Jersey filed for certiorari. The question presented is whether the 2010 Dodd-Frank Act preempted states from regulating sports bets that occur within their jurisdictions when those bets are offered on CFTC-registered markets. Three Indian Country cases move alongside it.

And underneath the appellate layer, the attrition continues. Missouri's attorney general, Catherine Hanaway, sent cease-and-desist letters to six platforms on September 16 and 17, alleging among other things that several of them let people under 21 reach sports contracts. PitchBook's model notes, without drawing the line, that Kalshi's minimum age is 18 and a licensed sportsbook's is 21. That three-year gap is not a marketing advantage. It is the specific factual allegation that state consumer-protection statutes are built to punish, and it is doing work in cease-and-desist letters right now.

None of that is priced into a $22.8 billion floor.

What a real bear case would look like

A genuine downside scenario is not "sports fees fall 25 per cent." It is a ruling that sports event contracts are not within the CFTC's exclusive jurisdiction, followed by 30-odd states asserting the authority the Ninth Circuit just told them they have. In that world Kalshi does not lose a quarter of its sports fees. It loses most of them in the large states, keeps them in the permissive ones, and has to decide whether to apply for gaming licences in jurisdictions whose regulators it has spent two years suing.

That last part is the piece that valuation models are worst at. A licensing application is not a spreadsheet input. It is a discretionary decision made by named people with institutional memory, and Kalshi has litigated against a large fraction of them. Rebuilding as a licensed operator is not impossible — plenty of companies have made that turn — but it is slow, and the revenue gap between the ruling and the licence is measured in years, not quarters.

The bear case should carry a number with a different first digit. We would put it below the Series F mark, not at it.

The strongest case for PitchBook's floor

Now the other side, properly made, because there is a real one.

First, the Supreme Court may simply deny certiorari. A denial leaves the split in place, which is untidy but commercially fine for Kalshi: the Third Circuit's territory stays open, the Ninth's closes, and the map fragments rather than collapses. Most of the country is in neither circuit and would be governed by district courts reading both. A fragmented map is exactly a 25 per cent haircut, which is what the model already has.

Second, the CFTC is not a bystander. It opened a public-interest rulemaking on prediction markets in June and has been issuing staff guidance rather than enforcement against the core sports product. A federal rule that blesses sports event contracts, with conditions, would moot most of the state litigation and make the bull case look conservative.

Third — and this is Granda's actual thesis, and it is a good one — the competitive position is close to unassailable. "Third parties will pick up crumbs here and there," he said, "but the window of opportunity for people to get in has passed." The cease-and-desist wave has been far more effective against Novig, ProphetX, Underdog and the brokerages than against Kalshi. Regulatory pressure has been clearing the field of everyone except the two companies with the balance sheets to litigate. If you believe the product category survives in any form, the survivors capture more of it than they would have in a friendlier world.

That argument is right about the competitive dynamics and wrong about the tail. "Kalshi wins the category" and "the category exists at this size" are two different bets, and the report's downside case only prices the first one.

The thing worth watching next

Polymarket's initiation lands September 30. It will be the more interesting document, because Polymarket's US sports exposure has a different shape and its offshore history gives PitchBook a genuinely hard modelling problem — one where the analyst cannot lean on a clean fee ledger.

What we would want from both, and did not get from this one, is a scenario with a probability attached to it. A valuation range of $22.8 billion to $42.1 billion on a company facing a binary federal question is not a range. It is a refusal to state the odds, published by a firm whose entire business is stating odds on private companies.

We do not know how the Supreme Court will handle the petition, and neither does PitchBook. The difference is that we are saying so.

Editor's note: TrueEdge builds odds and line-shopping tools and earns affiliate commissions from licensed sportsbooks. We have a commercial interest in how prediction markets and sportsbooks are regulated relative to one another. This piece argues a position; weigh it accordingly.