Comment Text:
Dear Chairman and Commissioners,
My name is Noah Smythe, and I'm a software engineer based in Texas. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I actively trade on platforms like Kalshi, and I strongly support the idea of well-regulated prediction markets. I believe they provide unique value to people like me, as well as to society at large, and I hope the CFTC will craft rules that allow these markets to thrive under fair oversight.
As someone in the tech industry, I'm always looking for reliable data to make informed decisions, whether it's for personal finances or understanding broader trends. Prediction markets have been a game-changer for me. I've found their forecasts to be consistently more accurate than polls or pundit opinions. For example, during the last election cycle, I relied on market odds to get a clearer picture of likely outcomes, which helped me plan for potential policy changes that could impact my freelance coding contracts. This kind of aggregated information isn't just useful for traders; it's a public good that helps everyone make sense of uncertain events.
I also see real value in how these markets let individuals and businesses hedge against risks. For me, trading on Kalshi has been a way to offset uncertainties tied to economic indicators like inflation data, which directly affects my cost of living and project budgets. If a small business or even a regular person can use these markets to protect against a bad policy outcome or an unexpected economic shift, that's a practical tool, not a game. I don't view this as gambling. It takes research and judgment, much like any other investment I make.
Regarding some of the CFTC's specific questions, I want to address a couple from the Public Interest section, like Question 7 on balancing innovation and consumer protection. I think regulated markets strike that balance. Platforms like Kalshi, under CFTC oversight, are safer than unregulated offshore alternatives. Banning or over-restricting these markets would just push activity to less secure places. And on Question 10 about price discovery, I believe prediction markets are unmatched in revealing what people really think, based on where they put their money. That insight shouldn't be stifled.
I understand concerns about manipulation or insider trading, but the CFTC already has tools to tackle those issues. Existing laws ban federal employees from trading on nonpublic info, and your agency can punish market manipulation. Shutting down entire markets to stop a few bad actors seems like overkill, and it punishes regular folks like me who just want access to these tools.
I'm asking the CFTC to support proportionate regulation of prediction markets. Don't ban or overly restrict them. Create clear rules that address specific risks while letting these innovative platforms operate. They provide real benefits, from better forecasts to risk management, and I believe they deserve a fair shot under your oversight.
Thank you for considering my input.
Sincerely,
Noah Smythe
