Meta Develops Prediction Markets App ‘Arena’ to Challenge Polymarket and Kalshi

Facebook’s parent company, Meta, is reportedly working on a prediction market app that will challenge the largest prediction market platforms, Polymarket and Kalshi. This comes as prediction markets continue to gain adoption, with institutional investors also tapping them to hedge their investments.

Meta Working On Its Prediction Market App

According to a New York Times report, the tech giant’s CEO, Mark Zuckerberg, has formed a team to create an app, ‘Arena,’ that will rival Polyamarket and Kalshi, citing two employees familiar with the matter. However, unlike these prediction market platforms, users will not wager money; the app will likely rely on a video game-like points system.

However, users being able to wager with money remains a possibility. Furthermore, Arena will reportedly be independent of Meta’s other applications, Facebook, WhatsApp, and Instagram. The employees also revealed that the tech giant will seek to grow the app using its large social networking audiences, directing them to the prediction market app.

This move is said to be part of Zuckerberg’s push to create new types of applications based on emerging online trends, with the effort characterized as a top priority. Meta is also looking to venture into crypto payments, including stablecoin integration.

As CoinGape reported, Meta offers Circle’s USDC for creator payouts through the Solana and Polygon networks. The tech giant is also reportedly working to launch a stablecoin, a move which anti-crypto Senator Elizabeth Warren has opposed.

Increased Scrutiny On These Platforms

Meta’s plans to develop a prediction market app come amid increased scrutiny on prediction market platforms. State regulators continue to crack down on these platforms, arguing that they are operating illegal gambling sites.

Meanwhile, as CoinGape reported, Gaming groups are currently lobbying senators to include language in the CLARITY Act that would prohibit sports betting on these platforms. These platforms are also facing scrutiny overseas, with South Korea earlier this month launching a probe into illegal gambling on Polymarket.

Polymarket is also facing added scrutiny following a WSJ investigation that revealed that the platform paid online creators to create misleading advertisements. However, the Federal Trade Commission (FTC) has yet to comment on whether it is launching an investigation into these allegations.