Prediction Market Startup Pascal Lands $9M in First Funding Round

Pascal closed $9 million in Series A financing as the startup prediction market looks to compete with the industry’s big boys.

The funding round was led by New York-based Union Square Ventures, marking the latest sign of venture investors’ appetite for prediction market firms. Pascal is a crypto-native prediction market as traders are required to post collateral in Solana smart contracts. The upstart company is betting it can better serve the professional trading community. Pascal’s over-the-counter (OTC) trading desk could be a source of allure for the institutional crowd because it attempts to bring liquidity to overlooked corners of prediction markets – an issue larger incumbents are grappling with.

When a trade is placed on Pascal, it’s “broadcast” so that a matching engine pairs both sides of the transaction so that it can be settled onchain.

“Only the matching engine can broadcast trades onchain, meaning all state transitions occur through the offchain API and trades are guaranteed to execute as soon as they are matched offchain,” adds Pascal. “Practically, this means that after depositing, traders do not need to interact with the chain to trade on Pascal.”

A ‘Second Wave’

There’s already ample evidence of cryptocurrency penetration in the prediction market universe, but the prevailing wisdom indicates there’s plenty of room for growth on that front and that yes/no exchanges are pivotal in expanding use cases for digital currencies.

Pascal’s presence at the intersection of cryptocurrency and prediction markets is relevant for another reason. As Nikhil Raman of Union Square Ventures points out, the last 15 years of novel market infrastructure and exchange history confirm there’s room for newer upstarts to gain market share from larger incumbents by focusing on underserved constituencies.

Pascal’s OTC desk offers exposure to the full gamut of event contracts, including corporate events, finance, geopolitical events and sports. The desk allows customers to tap orders on various prediction markets without having to interface directly with those platforms.

A Coup for Pascal

Venture investors are signaling appetite for the union of cryptocurrency and prediction markets. For its part, Pascal may be onto something with the Union Square Ventures investment because the firm has an impressive track record.

Among the companies that eventually went public that Union Square previously backed are well-known names including Coinbase, Etsy, MongoDB, Twilio and Twitter, among others.

“We are very excited to have led Pascal’s Series A financing,” adds Raman. “Pascal came out of stealth into private beta three weeks ago. They’ve received very positive feedback on UI, API quality and design, and liquidity and have already processed over 2 million contracts – all organic volume with fees and without incentives.”