Comment Text:
Dear Chairman and Commissioners,
Im writing to comment on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. My name is Cesar Delamadrid, and Im a student in California with a strong interest in economics and public policy. Ive used prediction markets like Kalshi a few times, and I want to share why I believe these platforms should remain accessible under fair, balanced regulation rather than facing overly restrictive rules.
As someone studying how information shapes decisions, Ive seen firsthand the value of prediction markets. Theyre not just a niche tool for traders; they produce forecasts that are often more accurate than polls or pundits. Ive relied on their insights to better understand public sentiment on economic and political events, and I believe this kind of transparent price discovery benefits everyone, from students like me to policymakers. Its a unique way to aggregate real-time information that you cant find elsewhere.
I also see prediction markets as a legitimate way for individuals and businesses to hedge real risks. Whether its a small business owner managing uncertainty around policy changes or someone like me thinking about how election outcomes might affect student loan policies, these markets offer a practical tool. Theyre not gambling. They require research and judgment, much like any other investment. Classifying event contracts as gaming ignores their economic purpose, and I urge the CFTC to recognize this distinction, especially in response to questions 15-22 on listed activities.
Im all for consumer protections and preventing manipulation or insider trading. But the CFTC already has strong tools to address these issues, as seen in other derivatives markets. Banning or over-restricting prediction markets doesnt solve problems; it pushes activity to unregulated offshore platforms where theres no oversight. Id much rather see platforms like Kalshi, operating under clear federal rules, remain accessible. This ties directly to questions 7-14 on public interest, where I believe the balance should favor innovation and access over excessive restriction.
Finally, the U.S. should be a leader in financial innovation. If we over-regulate, we risk ceding this space to other countries. As a student, I want to see my country at the forefront of new ideas, not playing catch-up. Addressing questions 33-40 on classification and costs, I think proportionate regulation can keep markets safe without stifling growth or burdening smaller participants like me.
Thank you for considering my views. I strongly encourage the CFTC to support fair, transparent regulation of prediction markets while avoiding broad bans or limits that could harm users and push activity offshore.
Sincerely,
Cesar Delamadrid
