The New York-based prediction market company Pascal has successfully secured $9 million in its Series A funding round, spearheaded by Union Square Ventures.
This funding follows a $6 million seed round completed last August, which received support from Wintermute Ventures and DBA.
Pascal enters a landscape currently led by Kalshi and Polymarket, which together hold a valuation exceeding $37 billion.
Kalshi, an exchange approved by the CFTC primarily serving US retail users, is valued at approximately $22 billion and is reportedly negotiating new funding that could potentially double this figure. Polymarket, which has garnered a user base through blockchain contracts and a global, crypto-aware audience, currently holds a valuation of $15 billion.
Unlike these competitors, Pascal aims to differentiate itself by building an institutional-level framework and trading mechanics designed for professional traders rather than casual bettors.
Innovative perpetual futures structure for event contracts
The primary offering from Pascal integrates perpetual futures mechanics within event contracts. Unlike standard yes/no contracts that expire once an event concludes, Pascal’s approach permits traders to maintain positions akin to perpetual contracts found on cryptocurrency derivative exchanges.
The company notes that its model comes with reduced trading fees and features designed to minimize “phantom fills,” which occur when trades seem to execute but ultimately do not settle.
“I envision a future with liquid markets addressing the risks faced by real businesses looking to hedge,” stated co-founder Ivo Crnkovic-Rubsamen in an interview with Fortune.
The name Pascal pays homage to the 17th-century mathematician Blaise Pascal, whose theories on probability have shaped contemporary decision-making processes under uncertainty.
Experience of the founders in trading
Crnkovic-Rubsamen and Matthew Downey’s partnership originated from their previous work in institutional trading prior to establishing Pascal. Crnkovic-Rubsamen has a history as a quantitative trader at Bridgewater Associates and D.E., later becoming the CEO at the crypto derivatives exchange dYdX in 2024.
Downey contributes experience from high-frequency cryptocurrency trading. The duo asserts that their insights into the limitations of existing prediction markets motivated them to create tailored tools catering to serious traders.
The platform has been available in a private beta since June and continues in this phase, with the company opting not to disclose any current trading volume figures.
Regulatory challenges ahead
The field of prediction markets has grown quickly over the last year, with promotional efforts visible at events such as World Cup matches and within the New York City subway system. The sector gained regulatory legitimacy once Kalshi obtained approval from the Commodity Futures Trading Commission in 2020, with platforms enjoying increased visibility during the 2024 presidential elections.
This expansion has attracted scrutiny. Several US states are exploring whether event contracts constitute unlicensed gambling, and various lawsuits are in progress questioning whether prediction markets should be governed federally or regulated on a state level.
Analysts are focusing on three key developments: whether Pascal secures necessary regulatory approvals or no-action letters distinguishing it in terms of compliance, how swiftly the platform is capable of attracting market makers capable of providing institutional-grade liquidity, and whether the perpetual futures model sustains trading volume once it transitions beyond the private beta stage.