Kalshi cut ties with Donald Trump Jr

[OsaiEmma]

So, I just saw this news recently. Apparently, after the Democrats took over the house and Senate in the midterm elections, they decided to launch an investigation on Donald Trump jr. and his investments especially in polymarket—kalshi precisely. Although kalshi framed it as "cutting ties because he invested in a rival company", but an article in the guardian—the source I got the news from—claims since the announcement came in just a week after the Democrats decision to investigate him, it seems like a convenient timing.

Donald Trump Jr is no longer a paid adviser for Kalshi, the prediction market company said Thursday.
Kalshi described it as a mutual business decision between the two parties that followed a decision by Trump Jr’s investment firm, 1789 Capital, to increase its investment in Kalshi’s biggest competitor Polymarket.
But the announcement comes a week after Democrats were able to take control of both the House and Senate in the midterm elections.
Democrats have said they planned to investigate the Trump family’s investments, including their business relationships with both prediction markets.
“We have mutually agreed to end Don’s advisory role after his firm’s significant investment in a competitor this past summer,” said Dani Lever, a spokesperson for Kalshi. “We are grateful for his contributions in helping us market Kalshi to more customers.”

(Source)

[DanWalker]

Serving as advisor for two competing prediction market will inevitably create image problem at some point. Especially when gap in market value between two company has widened to such an extent.

But timing of this decision coming right after midterm election seems quite convenient. Regardless of which party holds majority in Congress, prediction market remain highly politically sensitive and controversial. And hiring president's son as paid employee was like double edged sword from the very beginning. Lets see whether he will be able to retain Kalshi equity or if that share will also be taken back.

[Orpichukwu]

I was in discussion the other day with someone about how things are going to change for Polymarket and Kalshi after the US midterm election because the federal government is no longer going to be the same way it used to be, which is where they are gaining their backing from and trying to use that to bypass some state laws that try to categorise them as gambling platforms rather than prediction.

Back to Kalshi and Trump Jnr, it’s all political rather than what they are actually claiming; it’s been months, if not up to 3 months, when 1789 Capital made the investment increase in Polymarket. Did they take action and wait until when the father is on a hot seat in terms of deciding his next move, and when there is an investigation coming to the family at large, not just Trump Jnr?

[Churchillvv]

Of course it’s worth raising an eyebrow for, you mean you just discovered today he has ties with polymarket too? Cut the crab we know what you’re tryna do! That’s all this news says.

Kalshi is just protecting their interest just incase it fires back and they can have something to say about it. Of course Donald trump jr has used them to make lot of money from the informations he has and they benefited or so if the investigation gets to them in detention from trumps activities then it’s going to cost them risk of shutting down which is the reason why they announced now to be on the safer side.

[free-bit.co.in]

TBH, such official illustration given by Kalshi that Donald Trump Jr was pulled because of 1789 Capital's acquisition in Polymarket is pretty hard to swallow!

I'm sure this is something like clean excuse.

But the real cause is that, anticipating political heat likely to arise once Democrats take control of Congress regarding connection between prediction markets and Trump family, Kalshi has proactively moved to safe side.

So there is no way seeing this only as business competition. They need to bypass regulatory pressure at any cost.

[Justbillywitt]

TBH, such official illustration given by Kalshi that Donald Trump Jr was pulled because of 1789 Capital's acquisition in Polymarket is pretty hard to swallow!

I'm sure this is something like clean excuse.

But the real cause is that, anticipating political heat likely to arise once Democrats take control of Congress regarding connection between prediction markets and Trump family, Kalshi has proactively moved to safe side.

But if any investigation is lunched and something incriminating is found against Trump jr for the period he represented Kalshi, won’t the consequences affect Kalshi? Won’t the investigation cover the period that he represented the platform? Like everyone know the period he was with this platform and when they parted ways. Does it mean that with this parting ways, anything irregular that Trump jr might have done while with Kalshi will be forgotten and forgiven automatically? I just want to believe that their parting of ways was majorly business related and not because of any potential investigations.

[Z-tight]

Trump Jr has been an investor in Polymarket since last year, so i can understand why people do not believe the reason posted by Kalshi. The reason for cutting ties could be far bigger than increasing investment in a competitor.

If Trump Jr only started investing in Polymarket now, while holding an advisory role in Kalshi, then this report could have been much more believable. Anyway, we'd see what the democrats investigations into the Trump family, and their dealings with these markets would yield.

[Iranus]

In reality this cannot by any means be an ordinary corporate decision. Just a deeper look reveal that those tasked with conducting oversight in Senate and Congress will keep very close watch on  Trump family's holding in crypto and prediction market.

Perhaps Kalshi previously wanted to gain some political advantage by keeping Trump Jr on its board. But now, with the prospect of tightening liquidity and increased legal threat, they have dropped him. Key priority is to ensure their platform remain regulatorily compliant, using political figure as a brand carries very high level of risk!

[Davidvictorson]

So, I just saw this news recently. Apparently, after the Democrats took over the house and Senate in the midterm elections, they decided to launch an investigation on Donald Trump jr. and his investments especially in polymarket—kalshi precisely. Although kalshi framed it as "cutting ties because he invested in a rival company", but an article in the guardian—the source I got the news from—claims since the announcement came in just a week after the Democrats decision to investigate him, it seems like a convenient timing.

Donald Trump Jr is no longer a paid adviser for Kalshi, the prediction market company said Thursday.
Kalshi described it as a mutual business decision between the two parties that followed a decision by Trump Jr’s investment firm, 1789 Capital, to increase its investment in Kalshi’s biggest competitor Polymarket.
But the announcement comes a week after Democrats were able to take control of both the House and Senate in the midterm elections.
Democrats have said they planned to investigate the Trump family’s investments, including their business relationships with both prediction markets.
“We have mutually agreed to end Don’s advisory role after his firm’s significant investment in a competitor this past summer,” said Dani Lever, a spokesperson for Kalshi. “We are grateful for his contributions in helping us market Kalshi to more customers.”

(Source)

Well, they are free to do whatever they want.
I would do the same thing if you were in may advisory board and receive some sort of payment for it only to go and invest in a competitor. That is already a conflict of interest. I would therefore argue and believe that your actions does not align to the goal of the company and can cause losses which would have the organization as a whole. So it is better to cut ties, than to look the other way because of how influential you are.

[Odohu]

I was in discussion the other day with someone about how things are going to change for Polymarket and Kalshi after the US midterm election because the federal government is no longer going to be the same way it used to be, which is where they are gaining their backing from and trying to use that to bypass some state laws that try to categorise them as gambling platforms rather than prediction.

Back to Kalshi and Trump Jnr, it’s all political rather than what they are actually claiming; it’s been months, if not up to 3 months, when 1789 Capital made the investment increase in Polymarket. Did they take action and wait until when the father is on a hot seat in terms of deciding his next move, and when there is an investigation coming to the family at large, not just Trump Jnr?

This is the most logical comment I have seen here, unfortunately I have ran out of smerit to give for this comment. This decision has everything to do with the midterm election that did not favor the rulling party because Kashi need someone that can loby for them in the house, this was possible through Donald Trump Jr when the Republican were in control.

[free-bit.co.in]

But if any investigation is lunched and something incriminating is found against Trump jr for the period he represented Kalshi, won’t the consequences affect Kalshi? Won’t the investigation cover the period that he represented the platform? Like everyone know the period he was with this platform and when they parted ways. Does it mean that with this parting ways, anything irregular that Trump jr might have done while with Kalshi will be forgotten and forgiven automatically? I just want to believe that their parting of ways was majorly business related and not because of any potential investigations.

Also I wanted to think just like you, that this was purely business decision.
But look at timeline.
This whole thing doesn't seem like any coincidence at all!

Afaik, Trump Jr's firm 1789 Capital, actually increased its investment in their rival back in August.
Also he had already been on Polymarket's advisory board even earlier.
But at that time, conflict of interest involving Kalshi didn't come to mind nor did they immediately exclude him!

Precisely at the moment Democrats gained control of Congress in midterm election and announced investigation into Trump family's business dealing and crypto prediction market, Kalshi announced this breakup  

[Fivestar4everMVP]

Serving as advisor for two competing prediction market will inevitably create image problem at some point. Especially when gap in market value between two company has widened to such an extent.

But timing of this decision coming right after midterm election seems quite convenient. Regardless of which party holds majority in Congress, prediction market remain highly politically sensitive and controversial. And hiring president's son as paid employee was like double edged sword from the very beginning. Lets see whether he will be able to retain Kalshi equity or if that share will also be taken back.

From what i understand from the OP, i honestly do not think Kalshi's decision to cut ties with Donald trump jr. has anything to do with him investing in a rival company, or maybe he actually did not invest in a rival company and that this story of him doing so is simply made up.
I have this feeling that Kalshi decided to cut ties with Donald trump jr. simply as a way or means for them to save their own head, don't forget the part where they wrote that the Democrats' has a made a decision to investigate Trump's family and their investments in various companies/businesses which also includes the prediction market.
If my assumption isn't false, then it simply means there's definitely something about Donald Trump Jr. that Kalshi knows and doesn't want to get associated with.

[Swordsoffreedom]

Trump Jr has been an investor in Polymarket since last year, so i can understand why people do not believe the reason posted by Kalshi. The reason for cutting ties could be far bigger than increasing investment in a competitor.

As far as I know, discussion regarding stepping down from advisory position actually began last year. Just as 1789 Capital leads a major funding round for Polymarket. Both Kalshi and Trump Jr knew that providing advice to two competing firm simultaneously was becoming complicated.

I believe such a decision might not have been taken back then due to a low valuation.
When Trump Jr received $300000 worth of equity, Kalshi was valued at less than $2 billion.
Which has now grown to approximately $40 billion.
That equity has now grown into a substantial sum of money.

Regardless of whether or not political climate leads to regulatory change, inherent growth of regulated prediction markets is actual story here.

[noorman0]

-snip-
Precisely at the moment Democrats gained control of Congress in midterm election and announced investigation into Trump family's business dealing and crypto prediction market, Kalshi announced this breakup  

So, are you saying that Kalshi only wants the involvement of figures who can provide absolute "protection"? It almost makes it seem as though Kalshi has a greater stake in this than the Trump family itself. I wonder if there’s been something wrong with Kalshi from the very beginning (or perhaps Kalshi knows something about the Trump family’s game).

[Moreno233]

A lot of people attribute this development to conflict of interest but the coincidence is just too glaring. No doubt he was working for two competitors but both were ok with that until recently when the election was done, they realised it was conflict of interest, such a lame excuse. Ending the contract may definitely mean he has serviced his putpose and they don't find him helpful for them anymore.

[Nwada001]

Well, they are free to do whatever they want.
I would do the same thing if you were in may advisory board and receive some sort of payment for it only to go and invest in a competitor. That is already a conflict of interest. I would therefore argue and believe that your actions does not align to the goal of the company and can cause losses which would have the organization as a whole. So it is better to cut ties, than to look the other way because of how influential you are.

If we are to look at it from the business and contract standpoint, was it part of their contract that he won’t invest his asset in anything that appears to be in competition with them? Where I can say it’s right to cut him off based on the contract, which was after his company made a $300m investment in Polymarket, he also became part of the advisory board, which doesn't stand right to be on two sides considering the amount of information he can gain and share at will with any side.

[Fortify]

So, I just saw this news recently. Apparently, after the Democrats took over the house and Senate in the midterm elections, they decided to launch an investigation on Donald Trump jr. and his investments especially in polymarket—kalshi precisely. Although kalshi framed it as "cutting ties because he invested in a rival company", but an article in the guardian—the source I got the news from—claims since the announcement came in just a week after the Democrats decision to investigate him, it seems like a convenient timing.

Donald Trump Jr is no longer a paid adviser for Kalshi, the prediction market company said Thursday.
Kalshi described it as a mutual business decision between the two parties that followed a decision by Trump Jr’s investment firm, 1789 Capital, to increase its investment in Kalshi’s biggest competitor Polymarket.
But the announcement comes a week after Democrats were able to take control of both the House and Senate in the midterm elections.
Democrats have said they planned to investigate the Trump family’s investments, including their business relationships with both prediction markets.
“We have mutually agreed to end Don’s advisory role after his firm’s significant investment in a competitor this past summer,” said Dani Lever, a spokesperson for Kalshi. “We are grateful for his contributions in helping us market Kalshi to more customers.”

The balance of power is shifting right now and these companies were always skirting on the edge of legality. They no doubt used this connection to the president when discussing with regulators, prosecutors or rivals who might be cowered by the risk. Trump's family is so easily bought and they were ready to pay whatever bill he put forward, especially if any crackdowns could be diverted to their competitors instead. Now Kalshi see that it won't protect them much longer they are probably taking a calculated bet that it's cheaper to cut ties and the Trump connection is turning into a liability rather than an asset. It actually makes them an even greater target by keeping any connections around and they're probably hoping that dropping the connection maybe enough to stop investigators pushing too hard. Dirty tactics all round.