Kalshi Ends Trump Jr. Advisory Role Over Polymarket Conflict

Kalshi has terminated its advisory contract with Donald Trump Jr. after his venture capital firm, 1789 Capital, deepened its financial ties to Polymarket, Kalshi's main competitor in the U.S. prediction market. Reuters reported the split, citing a company spokesperson.

The decision closes an arrangement that began in January 2025 — the same month Trump Jr.'s father, Donald Trump, was sworn in as president. Kalshi had brought the president's son on as an adviser at a moment when politically themed event contracts were becoming a core part of its business.

How did the conflict of interest develop?

The trouble traces to 1789 Capital, Trump Jr.'s VC firm. In August of this's timeline first investment window — the firm made its initial investment in Polymarket, and Trump Jr. joined Polymarket's advisory board at the same time. That put one adviser on the boards of the two largest U.S. rivals in event contracts.

The situation escalated when 1789 Capital led Polymarket's latest funding round. By the summer, Kalshi and Trump Jr. had opened talks about ending the advisory relationship, the company said. Those talks concluded with the contract terminated.

The sequence matters for Kalshi operationally. Its prediction markets compete directly with Polymarket for liquidity, market makers and retail flow. Keeping an adviser whose firm was now a lead investor in the rival platform presented a conflict the exchange was unwilling to carry.

What is Utah's case against Kalshi?

The advisory split is not the only pressure on the company. Utah has filed a civil lawsuit against Kalshi and several of its market makers, alleging the defendants offered illegal gambling to state residents.

The state has gone further than a civil claim. Utah also filed criminal charges against the platform, raising the stakes beyond regulatory fines and into potential liability for the company itself.

Utah's action lands on a company already operating in a contested legal space. While federal regulators have permitted event contracts to trade on designated exchanges, state gambling statutes — Utah's among the strictest in the country — treat many of those same markets as unlawful wagering. The lawsuit against named market makers, not just the exchange, signals that state prosecutors see the liquidity providers behind Kalshi's order books as reachable targets.

What happens next?

The termination of Trump Jr.'s contract removes one conflict, but the Utah proceedings define the bigger question: whether prediction markets are exchanges or gambling operations under state law. That question now moves through both civil and criminal tracks, and its outcome will shape which platforms can operate in states that never authorized event contracts.