Kalshi, the CFTC-regulated prediction market platform that lets users trade on real-world event outcomes like elections, sports, weather, and more, just closed a massive $1 billion funding round at an $11 billion valuation—its third raise in 2025 alone.

This skyrockets the company’s value from $2 billion in June to $5 billion in October, and now double that, fueled by explosive growth: November trading volume hit a record $5.8 billion, up 32% from the prior month, with sports bets especially parlays driving over 90% of recent activity.

The windfall catapults co-founders Luana Lopes Lara and Tarek Mansour—both 29 and MIT computer science grads—into billionaire territory. Each holds an estimated 20-25% stake, translating to a paper net worth of about $1.3 billion per person though some reports peg it closer to 12% based on dilution.

For Lopes Lara, a Brazilian-born former professional ballerina who danced in “Swan Lake” productions in Austria before pivoting to fintech with summer stints at Bridgewater and Citadel, this crowns her the world’s youngest self-made woman billionaire at 29—edging out Scale AI’s Lucy Guo (31) and pop icon Taylor Swift previously the benchmark at around $1.6 billion.

The round was led by crypto powerhouse Paradigm, with heavy hitters like Sequoia Capital, Andreessen Horowitz, ARK Invest, CapitalG (Alphabet’s growth arm), Meritech, IVP, Anthos, and Y Combinator piling in.

Proceeds will fuel brokerage integrations it’s already live on Robinhood and Webull, global expansions, content partnerships a CNN tie-up is reportedly in the works, and crypto pushes via Solana for tokenized event contracts.

Liquidity comes from pros like Susquehanna International Group, and partnerships span the NHL to StockX. It’s the only fully regulated U.S. player in a sector exploding post-2024 election where it nailed Trump’s win weeks early on $500M+ in bets, outpacing Polymarket’s $3.6B unregulated volume.

A fresh class-action lawsuit in New York accuses it of unlicensed sports betting and misleading users on peer-to-house dynamics, plus state-level scrutiny on contracts. Investors shrug it off—Y Combinator’s Michael Seibel calls it a “company with as much potential impact on the world” as any he’s seen.

The news is lighting up X, with Forbes’ post racking up buzz and users hailing Lopes Lara’s “brutal ballet to billionaire” arc as inspirational. In a prediction market twist, odds are high this is just the warmup for Kalshi’s global dominance.

Prediction markets are online platforms where people buy and sell contracts that pay out based on the outcome of future real-world events. They work like a stock market, but instead of trading shares in companies, you trade the probability of something happening—like “Will Donald Trump win the 2026 midterms?” or “Will Bitcoin hit $200k by December 31, 2026?”

“Will the Federal Reserve cut interest rates in March 2026?” Two types of contracts are created: Yes contract and No contract. Each contract costs between $0.00 and $1.00.If the contract is trading at $0.65 ? the market thinks there’s a 65% chance the event happens.

If you buy 100 “Yes” contracts at $0.65 and the Fed does cut rates ? each Yes contract pays $1.00 ? you make $100 ? $65 = $35 profit. If the Fed does NOT cut rates ? Yes contracts become worthless ? you lose your $65.

This is why prediction market prices are interpreted as crowd-sourced probabilities. Money where your mouth is. People who know the most or research the hardest can profit, so the incentives push prices toward the true probability.

24/7 real-time probabilities. Unlike polls that update weekly, prediction markets update instantly as news breaks. Cover almost anything. Elections, sports outcomes, economic data, Oscars, weather, wars, celebrity breakups, scientific discoveries, etc.

Used by hedge funds, journalists, and governments as leading indicators. Create liquidity for “information” itself. Can feel like gambling some states still ban or restrict them. Assassination markets or morally questionable events sometimes pop up on unregulated platforms.

Prediction markets turn “What do you think will happen?” into “How much are you willing to bet will happen?”—and the collective answer has proven remarkably accurate.

Connecticut Issues Cease-and-Desist Orders to Kalshi, Robinhood, and Crypto.com Over Unlicensed Sports Wagering

Connecticut’s Department of Consumer Protection (DCP) Gaming Division sent cease-and-desist letters to KalshiEX LLC, Robinhood Derivatives LLC, and Crypto.com, accusing them of operating unlicensed online gambling—specifically sports wagering—through “sports event contracts” on their prediction market platforms.

These contracts allow users to bet on outcomes of real-world events like sports games, which the state views as illegal gambling under its laws, rather than federally regulated financial derivatives.

The platforms must stop all advertising, promotion, offering, or availability of these contracts or any other unlicensed gambling products to Connecticut residents right away. They are also required to allow affected users to withdraw any funds held in their accounts.

Only state-licensed entities can offer sports wagering in Connecticut. The DCP argues that these prediction markets lack such licenses and expose users to risks like underage betting (under 21) and lack of protections against insider trading or irregular wagering patterns—standards enforced in licensed sportsbooks.

Commissioner Bryan T. Cafferelli emphasized that non-compliance could lead to civil penalties and potential criminal charges under state gaming laws. This action highlights growing tensions between state gambling regulators and federal oversight.

The platforms claim their products are CFTC-regulated “event contracts” or swaps under the Commodity Exchange Act, exempt from state gambling rules.

However, states like Connecticut, New York, and Nevada have pushed back, with courts (e.g., a recent Nevada ruling) siding against broad federal preemption of sports betting.

Kalshi alone has faced similar orders in at least eight other states this year, including Arizona, Illinois, and Ohio. The platform, where ~74% of bets involve sports markets, called the orders misguided and filed a federal lawsuit in Connecticut’s District Court seeking an injunction to block enforcement.

Spokesperson Jack Such stated: “Kalshi is a regulated, nationwide exchange for real-world events, and it is subject to exclusive federal jurisdiction. It’s very different from what state-regulated sportsbooks and casinos offer.”

Robinhood: A spokesperson defended their offerings as “federally regulated by the CFTC and offered through Robinhood Derivatives, LLC, a CFTC-registered entity, allowing retail customers to access prediction markets in a safe, compliant, and regulated manner.”

Crypto.com: No immediate public response as of December 4, 2025, though the company has been drawn into the prediction markets debate alongside its crypto services.

This crackdown could signal more state-level scrutiny on prediction markets, potentially affecting user access in Connecticut and influencing ongoing federal-state jurisdictional battles.

For Connecticut residents with open positions, the DCP advises monitoring accounts for withdrawal options and seeking help for gambling concerns via the state’s 24/7 helpline.

The situation remains fluid, with Kalshi’s lawsuit likely to test whether these platforms can continue operating nationwide under CFTC rules. Recent X discussions echo the regulatory divide, with users noting it as a “setback for prediction markets” and potential “massive implications for DeFi compliance.”

Connecticut residents must be allowed to withdraw funds from these platforms, but open positions may be frozen or settled under duress. This could lead to financial losses if markets are abruptly halted, especially for high-volume sports bets ~74% of Kalshi’s activity is sports-related.

The DCP highlights risks like underage access and lack of geofencing, potentially exposing users to scams or data breaches without state-mandated safeguards. Kalshi, Robinhood Derivatives, and Crypto.com must geo-block Connecticut IP addresses and halt all marketing there, reducing their U.S. user base by ~1-2% per platform.

Non-compliance risks civil fines up to $5,000 per violation and criminal charges under Conn. Gen. Stat. § 53-278e. Crypto.com, already pausing operations in Nevada, faces compounded costs for compliance tech upgrades.

This is the 11th state action against prediction markets in 2025 joining Arizona, Illinois, Maryland, Massachusetts, Michigan, Montana, Nevada, New Jersey, New York, Ohio, and Pennsylvania.

A win for states could prompt copycat orders nationwide, fragmenting national platforms into a patchwork of compliant markets—similar to how sports betting legalization varies post-2018 PASPA repeal.

The U.S. Securities and Exchange Commission (SEC) must undertake a major regulatory overhaul, according to SEC Chair Paul Atkins, who used a major address at the New York Stock Exchange on Tuesday to call for a sweeping “reset” of disclosure requirements and a reduction of legal burdens faced by smaller companies.

Atkins’s vision, which seeks to “tilt the balance of power from investors back toward companies,” directly challenges the efficacy and necessity of numerous investor protection rules established after the 2008 financial crisis.

Atkins emphasized that the concept of financial materiality should be the “north star” of the SEC’s disclosure framework, arguing that too much mandated information is “unmoored from materiality” and only serves to confuse investors.

“When the SEC’s disclosure regime has been hijacked to require information unmoored from materiality, investors do not benefit,” Atkins stated in his prepared remarks, signaling the agency’s shift toward a deregulatory policy agenda.

Targeting the “Frankenstein Patchwork” of Executive Pay Rules

At the heart of Atkins’s reform target are the rules surrounding executive compensation, which he and other Commissioners have characterized as a “Frankenstein patchwork”—an overly complex and expensive regime that obscures rather than illuminates pay decisions. Atkins and fellow Republicans are explicitly aiming at several key provisions mandated by the Dodd-Frank Act of 2010

The most highly publicized target is the requirement for companies to disclose the ratio of CEO compensation to the median pay of all other employees. Critics, including Atkins, argue this figure is arbitrary and misleading because it varies wildly based on factors unrelated to management performance, such as whether a company employs more part-time, seasonal, or international workers. For instance, the average CEO-to-worker pay ratio at S&P 500 companies stood at 285 to 1 last year, a number Atkins and corporate leaders argue has created “envy, not moderation,” citing Warren Buffett, who noted the rules helped drive up CEO pay by allowing them to benchmark themselves against disclosed figures.

This rule mandates that companies clearly describe the relationship between executive compensation “actually paid” and the company’s financial performance. Many believe that the complexity of the required formula often results in a metric that is disjointed from the total compensation reported in other tables, imposing high compliance costs without providing clear, decision-useful information to shareholders.

Atkins is also pushing to revise the detailed compensation tables, including potentially eliminating the complex Option Exercise and Stock Vested Table and increasing the disclosure thresholds for executive perquisites (perks). Some critics lament that the detailed disclosure of perks—like security expenses or corporate jet usage—is “salacious” and detracts from the material financial picture.

Easing the Regulatory Burden on Small Business

A second major pillar of the SEC Chair’s reform agenda is providing relief to smaller companies, arguing that the current compliance burdens act as a barrier to capital formation and growth.

“The last comprehensive reform to these thresholds took place in 2005,” Atkins said, denouncing this as a “dereliction of regulatory upkeep.”

Under the current system, a company with a public float as low as $250 million is subjected to the same exhaustive disclosure requirements as a company 100 times its size. Atkins indicated the SEC would look to “right-size” disclosure obligations, making them scale with a company’s size and maturity, and potentially expanding the grace periods available to newly public companies to incentivize more Initial Public Offerings (IPOs).

However, critics, particularly Democrats, warn that this deregulatory agenda risks dismantling essential investor protections put in place following the 2008 financial meltdown, when executive compensation practices encouraged excessive risk-taking. Concerns remain that Atkins’s approach—combined with a declining SEC workforce—will weaken the agency’s ability to police financial markets, potentially allowing risk and misconduct to build up in the system.

The stage is now set for a major political and legal confrontation as the SEC begins to formally revise rules rooted in one of the most significant pieces of financial legislation in modern history.

U.S. spot XRP exchange-traded funds (ETFs) recorded a robust net inflow of $67.74 million, elevating their cumulative net assets under management (AUM) to $844.99 million.

This marks the 12th consecutive day of positive inflows since the funds launched on November 13, 2025, positioning XRP ETFs as the fastest-growing major crypto asset vehicle in the market.

The milestone underscores accelerating institutional adoption of XRP, the native token of the Ripple network, even as it trades around $2.19—up nearly 10% in the past 24 hours.

The $67.74 million influx reflects sustained buying pressure from ETF clients, including major players like Vanguard, which recently listed XRP ETFs on its platform for broader access.

This builds on prior days’ momentum, with total inflows now approaching the $1 billion threshold. At least five spot XRP ETFs are active, including offerings from Grayscale (GXRP), Franklin Templeton (XRPZ), Bitwise, Canary Capital, and others.

Early launches saw strong debuts—e.g., Grayscale’s fund pulled in $67.36 million on day one, while Franklin Templeton’s attracted $62.59 million. Real-time trackers show over 339 million XRP tokens locked across these funds, equivalent to roughly 0.3% of the total circulating supply.

XRP’s price surge aligns with broader crypto optimism, including Bitcoin topping $92,000 and Ethereum at $3,073. However, on-chain data indicates 29% of XRP has left exchanges recently, signaling reduced selling pressure and potential for further upside.

Analysts note a bullish RSI divergence, hinting at a trend reversal despite prior volatility. This inflow streak highlights XRP’s maturation as a regulated investment option, outpacing many peers in growth rate. With ETFs now absorbing significant volumes like models suggest daily buys of 74.5 million XRP could drive prices to $600 under certain elasticity assumptions, it could catalyze a new bull cycle for the altcoin.

As the creator of XRP—the native cryptocurrency of the XRP Ledger (XRPL)—Ripple has been instrumental in shaping the regulatory, infrastructural, and market conditions that enabled these ETFs to launch in November 2025.

While Ripple does not directly issue or manage the ETFs which are handled by third-party asset managers like Grayscale, Franklin Templeton, and Bitwise, its efforts in legal advocacy, technological development, and ecosystem building have been pivotal in unlocking institutional access to XRP.

Ripple’s four-year legal battle with the U.S. Securities and Exchange Commission (SEC)—initiated in 2020 over allegations of unregistered securities sales—served as a critical proving ground for XRP’s non-security status. A landmark July 2023 court ruling affirmed that XRP sold on public exchanges is not a security, while institutional sales were deemed violations.

The SEC appealed but withdrew its challenge in March 2025, culminating in an August 2025 settlement that fully resolved the overhang. This clarity was the green light for spot ETF filings, as it aligned XRP with the regulatory framework that approved Bitcoin and Ethereum ETFs in 2024.

Without this resolution, issuers like Canary Capital and Bitwise could not have pursued “auto-effective S-1” filings under the SEC’s streamlined 2025 process. Ripple CEO Brad Garlinghouse has publicly hailed the outcome as a “win for the entire crypto industry,” emphasizing how it positions XRP as a utility token for payments rather than an investment contract.

The ledger’s consensus protocol enables near-instant transactions (3-5 seconds) at low costs, making it ideal for the high-volume creations and redemptions in ETF operations—where authorized participants exchange baskets of XRP for fund shares.

Ripple’s On-Demand Liquidity (ODL) solution, which uses XRP as a bridge asset for cross-border payments, further underscores its real-world utility, attracting banks and institutions that now view XRP ETFs as a regulated entry point.

Ripple’s recent innovations, like the XRPL lending protocol and integration with ISO 20022 standards, enhance this appeal. For instance, Abu Dhabi’s approval of Ripple’s RLUSD stablecoin for institutional use ties directly into ETF liquidity pools.

Garlinghouse has stressed XRP’s role as a “temporary settlement layer” in global finance, a narrative amplified on X where analysts link it to ETF-driven volume surges. Funds like Grayscale’s GXRP explicitly reference the “peer-to-peer Ripple Network” in their prospectuses, crediting it for XRP’s 13-year track record of reliability.

Ripple’s $500 million funding round in November 2025 at a $40 billion valuation—from firms like Citadel Securities—signals strong backing for scaling XRP’s role in tokenized assets and remittances, projected to capture 14% of SWIFT’s volumes.

While Ripple holds a significant portion of XRP about 40 billion in escrow, it does not directly sell to ETFs, avoiding past SEC scrutiny. Instead, it supports market makers and liquidity providers.

Ripple’s presence at events like Swell 2025, alongside White House officials, has sparked ETF buzz, with posts highlighting how these ties could drive $8 billion in inflows.

ETFs as a Ripple-Led Bull CatalystSince the November 13, 2025, launch of the first spot XRP ETF Canary’s XRPC, with $58 million in debut volume, Ripple’s ecosystem has seen explosive growth.

Total ETF AUM hit $844.99 million by December 3, outpacing early Bitcoin ETF inflows in relative terms. Analysts forecast a 65% XRP price rally to $3.60+ by year-end, driven by ETF demand reducing exchange supply 29% of XRP off exchanges recently.

Ripple’s positioning of XRP for $30 trillion in tokenized assets amplifies this, with ETFs funneling retail and institutional capital into its payments infrastructure. However, risks persist: XRP’s price remains volatile down 40% from its $3.65 July ATH, and competition from stablecoins like USDT challenges its dominance.

Ripple’s escrow releases 1 billion XRP monthly could pressure supply if not managed tightly. Ripple envisions XRP ETFs as a “regulated gateway” to its broader mission of modernizing $120 trillion in annual cross-border flows.

With more filings pending (e.g., 21Shares’ TOXR launching December 2), and futures ETFs like ProShares’ UXRP paving the way, Ripple’s role could evolve into deeper integrations, such as ETF-linked ODL pilots.

As Garlinghouse noted, “XRP connects the digital financial system”—a connectivity now supercharged by Wall Street. For investors, this convergence offers exposure to utility-driven growth, but always DYOR amid crypto’s inherent risks.

Leveraged exchange-traded funds tied to Strategy Inc., the bitcoin-hoarding Nasdaq heavyweight that built its identity on turning corporate cash into cryptocurrency, are among the worst casualties of this year’s crypto market slump.

The downturn has exposed how fragile leveraged vehicles become when their underlying asset breaks down, and it is prompting renewed debate about whether corporate treasury strategies anchored to bitcoin can survive prolonged risk aversion.

The T-Rex 2X Long MSTR Daily Target ETF and the Defiance Daily Target 2x Long MSTR ETF, which both aim to deliver twice the daily return of Strategy shares, have lost nearly eighty-five percent of their value in 2025. The T-Rex 2X Inverse MSTR Daily Target ETF, meant to offer twice the inverse performance, has also suffered heavy damage, sliding forty-eight percent during the same period.

The simultaneous collapse of both long and inverse leveraged plays reveals the strain that extreme volatility places on daily-reset products, where slump-on-slump losses can compound rapidly and erode capital even when investors guess the direction correctly.

Strategy itself has tumbled more than forty percent this year, dragged down further after bitcoin fell below ninety thousand dollars. The cryptocurrency had reached a record of $126,223.18 in October before global risk aversion choked off the speculative rally and sent capital fleeing to safer assets. That reversal has hit Strategy harder than most because its identity—and valuation—has been treated by markets as a high-beta proxy for bitcoin.

Michael Saylor’s buy-and-hold bitcoin treasury model, which turned Strategy into the most aggressive corporate accumulator of crypto, has inspired dozens of imitators, though many of the companies that mirrored the approach have also posted outsized share-price declines this year. With bitcoin sliding and equity markets jittery, investors have been forced to reassess the idea that enterprise value can sustainably track crypto holdings through every cycle.

The company’s “mNAV” metric has become a key focus. CEO Phong Le said on the “What Bitcoin Did” podcast that Strategy may consider selling bitcoin if the ratio falls below one. Reuters calculations using LSEG data place the ratio near 1.1, giving the company some breathing room, but the comment unsettled investors who long believed Strategy would never sell under adverse conditions. Mike O’Rourke, chief market strategist at JonesTrading, said Le’s remarks undermined Strategy’s central marketing message of not selling despite volatility.

The change in tone comes against a harsh financial backdrop. On Monday, Strategy cut its full-year outlook to a range between a $6.3 billion profit and a $5.5 billion loss, far below its earlier estimate of $24 billion in net profit. That earlier figure, issued October 30, was based on an assumption that bitcoin would reach $150,000 by year-end. The company also disclosed a $1.44 billion reserve to cover dividends on preferred shares and interest on existing debt, highlighting how the tightening crypto environment is eroding financial flexibility.

Vincenzo Vedda, chief investment officer at DWS, said the strategy works only when bitcoin rises, adding that once prices fall, the options left to the company become very limited. The comment captures how sharply investor sentiment has turned: when bitcoin rises, Strategy is hailed as a visionary; when it falls, the business model appears exposed.

Short sellers have seized the moment, earning more than $2.5 billion betting against the stock this year, including around $156 million on Monday alone, according to Ortex. The stock has fallen more than seventy percent from its November 2024 peak and has more than halved since joining the Nasdaq 100 index.

Despite all this, analysts remain surprisingly optimistic. Of sixteen brokerages covering the stock, ten rate it a “buy,” four call it a “strong buy,” and two advise holding, according to LSEG data. The median price target of $485 implies a one-hundred-eighty-three percent gain over the next year.

Saylor delivered a keynote titled “The Undeniable Case for Bitcoin” at a Binance conference in Dubai on Wednesday, even as markets reassess what the case looks like in practice.

The broader market downturn has revived concerns about regulatory risk, especially as leveraged crypto-linked ETFs come under scrutiny. Regulators in the United States and Europe have spent the last two years debating whether daily-reset leveraged products tied to volatile assets belong in retail portfolios. Episodes like the current slump tend to sharpen those debates.

With leveraged Strategy ETFs suffering extreme losses and undergoing heavy intraday swings, questions are growing about liquidity resilience—particularly whether creation and redemption activity can keep up when market makers face widening spreads and underlying shares move unpredictably. These pressures do not imply imminent malfunction, but they do underscore how thin liquidity can become when sentiment evaporates, and leveraged structures amplify stress.

Corporate bitcoin strategies face similar questions. The downturn exposes how sensitive these models are to market pricing and how little room they leave for operational conservatism. If Strategy ultimately sells bitcoin to defend its mNAV threshold, it would mark a symbolic shift for a company long positioned as an immovable accumulator. Even the possibility of such a move signals that corporate treasury models built around bitcoin may evolve into more flexible or hedged counterparts—something that could reduce the mystique but potentially improve balance-sheet stability.

For now, the slump is a reminder that the bitcoin-as-treasury model works spectacularly in bull markets and brutally in downturns. The leveraged ETFs tied to Strategy show the same truth in more explosive form. Investors earn exponential upside when momentum is strong, yet when selling takes over, the losses arrive with equal force.