TLDR:Donald Trump Jr’s advisory contract with Kalshi ended after 1789 Capital’s investment in Polymarket, which the exchange identified as the reason for the mutual split.Kalshi said the agreement was mutual and credited Trump Jr with helping it reach more customers, while denying that political considerations drove the decision.Reuters reported discussions began in August and Kalshi contacted Trump Jr in the fall, months after 1789 Capital led Polymarket’s latest funding round.Reuters linked the Democratic sweep of Congress to possible scrutiny of White House-linked firms, as lawmakers propose restrictions on markets tied to sensitive actions.Kalshi ended Donald Trump Jr’s advisory contract Thursday after his firm, 1789 Capital, invested in rival prediction market Polymarket. The company described the departure as mutual and linked it to an investment announced in August. Trump Jr joined the exchange as a strategic adviser in January 2025. Prediction markets had gained attention after Donald Trump won the 2024 presidential election. Reuters reported the exit on November 12, citing Kalshi and sources familiar with discussions. His departure ends a role connecting a political figure to two competing platforms. Prediction markets also face growing scrutiny from lawmakers and regulators in Washington and beyond.Donald Trump Jr Leaves Kalshi After Polymarket InvestmentA Kalshi spokesperson told Reuters the company and Trump Jr agreed to end the relationship. The spokesperson said 1789 Capital’s investment in a competitor prompted the change. Kalshi also credited him with helping it reach more customers. 1789 Capital led Polymarket’s latest funding round.Discussions about Donald Trump Jr’s advisory contract began in August, when 1789 Capital’s Polymarket investment became public. Kalshi contacted him in the fall to discuss the potential conflicT.. A source familiar with the matter said the exchange raised the issue directly with Trump Jr. The timeline shows discussions extended across several months.Donald Trump Jr received an equity stake when Kalshi named him a strategic adviser in January 2025. The Financial Times reported the stake was worth about $300,000 at the time. Reuters did not say whether ending the advisory contract changed his ownership. Its report did not disclose the size of 1789 Capital’s investment or the terms of its Polymarket stake.Kalshi said politics played no role in the decision. Two people familiar with company discussions told Reuters that some employees worried about possible consequences. Democrats had won both congressional chambers. That account differs from Kalshi’s stated reason, which centered on 1789 Capital’s investment.The Donald Trump Jr advisory role linked him to one prediction market while his firm backed another. That overlap can invite questions about potential conflicts, even though Kalshi framed the exit as mutual. Neither Donald Trump Jr nor Polymarket immediately responded to Reuters’ requests for comment.Lawmakers Call for More Scrutiny of Prediction MarketsKalshi and Polymarket let customers trade contracts tied to real-world outcomes. Listed markets include elections, economic developments, sports and political decisions. The companies compete for users, trading volume and liquidity. A venture investment in one platform matters when an adviser works with its rival.Customers buy and sell event contracts, with prices reflecting perceived likelihoods. Beyond politics, sports listings have become a regulatory flashpoint for federal and state officials. Critics say oversight and consumer protections remain unresolved. The debate spans market integrity, state gambling laws and federal jurisdiction in a growing industry.Prediction markets entered wider debate during the 2024 presidential election. Their forecasts drew attention as they diverged from traditional polling. Kalshi promoted its election forecasts and criticized pollsters that did not predict Trump’s victory, Reuters reported. The platforms now face scrutiny over market rules, insider trading concerns and gambling boundaries.Lawmakers have questioned sports contracts and oversight. Nevada Senator Catherine Cortez Masto challenged the CFTC’s approach to sports-related products. She also wrote that the Trump family was heavily invested in prediction markets.Federal courts have ruled repeatedly that states and Tribes regulate gambling within their territory. Sports “prediction markets” are obviously gambling. But the Chairman of the CFTC is encouraging companies to keep offering these bets in violation of court orders.Let’s be… https://t.co/4OCzMmZ7Uq— Senator Cortez Masto (@SenCortezMasto) November 9, 2026California Representative Ro Khanna separately called for a ban on sports event contracts, saying they amounted to sports betting. The comments reflect a policy dispute over federal and state authority.Reuters linked the Democratic sweep of Congress to potential scrutiny of companies tied to the White House. Lawmakers have introduced proposals to restrict contracts connected to military operations and other sensitive government actions. The advisory role has ended, but competition and regulatory questions around prediction markets remain open.The post Kalshi Ends Donald Trump Jr Advisory Role After Polymarket Deal appeared first on Blockonomi.