Peter Diamandis, the Ansari X-Prize Foundation chairman, expects to pay up within five months – though the winner is likely to have spent far more on the spaceship's development.
Speaking at the recent 41st Space Congress, held at Cape Canaveral in Florida on Wednesday, Diamandis backed aerospace pioneer Burt Rutan as the favourite to win.
And although a total of 26 teams are competing, some have already started to look at what they might do after the main challenge has been met.
The competition is to place a three-person spaceship on to a suborbital trajectory - reaching an altitude of 100km - twice in two weeks.
Burt Rutan's company, Scaled Composites, has already flown its spacecraft at altitudes exceeding 15km and at supersonic speeds. Insiders speculate he could make a suborbital flight within a few months.
Other teams are also poised on the verge of a serious launch attempt. In particular, the Canadian Da Vinci team - which uses a balloon to help its craft reach altitude.
Rutan may make his attempt from Mojave airport in California. The Da Vinci team has already obtained a launch licence in Canada.
The Ansari X-Prize Foundation is looking beyond the winning of the prize and considering an annual event that could be held in Florida or New Mexico.