Comment Text:
Dear Chairman and Commissioners,
I'm a software engineer based in Texas. I’m writing to provide my input on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I’ve been an active trader on platforms like Kalshi, and I strongly support the development of well-regulated prediction markets in the United States. I believe they offer unique value to individuals like me, as well as to society at large, and I’m concerned about the risks of over-restriction or outright bans.
As someone working in tech, I value access to cutting-edge tools and information. Prediction markets provide insights I can’t get from polls or news outlets. Their prices often predict election outcomes or economic events more accurately than traditional sources, which helps me make informed decisions both personally and professionally. I’ve used platforms like Kalshi to hedge risks tied to political events that could impact my freelance tech consulting work, such as policy changes affecting taxes or regulations. This isn’t gambling to me; it’s a practical way to manage uncertainty, much like how I’d use other financial tools.
I’m particularly worried about the idea of classifying event contracts as gaming. That label doesn’t fit. Trading on these markets requires research and real-world judgment, just like investing in stocks or futures. It serves a legitimate economic purpose, whether it’s hedging risks or contributing to price discovery. Banning or over-restricting these markets won’t eliminate demand; it will just push activity to unregulated offshore platforms where there’s no consumer protection. I’d much rather trade on a CFTC-regulated platform like Kalshi, where I know there are safeguards in place.
Regarding some of the specific questions in the ANPR, I’d like to address Question 11 on public interest and balancing innovation with protection. I believe the US has a chance to lead in financial innovation here. If we over-regulate or ban prediction markets, we’re handing that leadership to other countries. Also, on Question 29 about inside information, I think informed trading actually improves price discovery. The more knowledgeable participants are in the market, the more accurate the prices become, which benefits everyone. Existing laws already prohibit insider trading by federal officials, so the focus should be on enforcement, not broad prohibitions.
I understand concerns about manipulation or bad actors, but the CFTC already has tools to address those issues. Let’s not punish law-abiding participants by restricting access. I urge you to support proportionate regulation that keeps prediction markets legal and accessible on regulated platforms, ensuring consumer safety without stifling innovation or driving activity offshore.
Thank you for considering my perspective.
