Mark Zuckerberg Explored Buying Kalshi Before Meta Pivoted to Building Its Own Prediction Market App

Mark Zuckerberg explored acquiring Kalshi last year before the talks fell apart, according to a report from NPR, sending Meta on a different path: building its own prediction market application in-house. Zuckerberg met with Kalshi CEO Tarek Mansour about a possible takeover as the prediction market platform’s popularity surged, but negotiations never advanced. Meta is now developing a standalone app internally codenamed Arena, a play-money prediction platform that will let users wager on future events without real cash changing hands.

NPR, citing people with direct knowledge of the discussions, said there are competing accounts of why the deal collapsed. Some say Mansour was not interested in selling; others suggest Zuckerberg stepped back from the acquisition after evaluating the legal and regulatory complexity that has surrounded Kalshi’s operations — including ongoing litigation with more than a dozen states over whether its sports event contracts constitute unlicensed gambling. Neither company commented to NPR on the talks.

Arena: Meta’s Play-Money Alternative

Internal documents reviewed by NPR describe Arena as an AI-powered prediction market product where users bet play money — not real currency — on the outcomes of news events and trending topics. Meta’s AI systems would generate the questions and determine winners. By using play money instead of real cash, Meta sidesteps the regulatory and legal battles that have defined Kalshi’s expansion into sports markets and state-by-state enforcement actions.

Despite the failed acquisition, Meta and Kalshi have maintained a commercial relationship. The two companies struck a partnership in March that integrates Kalshi’s live prediction markets into Meta’s Threads social media platform, giving Kalshi distribution across one of Meta’s fastest-growing apps. For Kalshi, the Threads integration is a meaningful marketing channel even without a full acquisition.

Staggering Industry Growth Drove Meta’s Interest

The scale of prediction market growth helps explain why Zuckerberg was interested in the first place. Monthly trading volume across Kalshi and Polymarket climbed from roughly $28 billion in June 2025 to nearly $220 billion a year later, according to data from The Block. Sports-related contracts — particularly around the World Cup and major league games — account for the bulk of that volume.

Kalshi is currently pursuing a new funding round at a reported valuation of $40 billion, reflecting the investor community’s enthusiasm for the space. At the same time, the company faces significant legal pressure, including a temporary restraining order issued by a Michigan court on June 30 that bars Kalshi from offering sports event contracts in that state under penalty of $120,000 per day.

For sports bettors and prediction market enthusiasts, Meta’s entry into the space — even in a play-money format — represents a meaningful shift in how mainstream platforms view these products. Established sportsbook operators like DraftKings and FanDuel have been watching prediction market growth closely. DraftKings took its own decisive step in this direction last week with the launch of DKeX, its proprietary prediction market exchange. As DFS platforms, sportsbooks, and tech giants all move toward the same space, the prediction market landscape is becoming more competitive — and more mainstream — by the week.