Comment Text:
Dear Chairman and Commissioners,
My name is Adam Talbot, and I'm a student from Louisiana. I'm writing to comment 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 development of well-regulated prediction markets. I believe they provide unique value to people like me and to society as a whole, and I want to share my perspective as someone who uses these markets regularly.
As a student, I don't have a huge income, but I do have a keen interest in understanding the world around me. Prediction markets give me a way to engage with real-world events, from elections to economic indicators, in a way that's both educational and practical. I've used these markets to hedge personal financial risks, like betting on inflation data to offset concerns about rising costs for rent and groceries. It's not gambling to me. It's a way to make informed decisions based on research and analysis, much like investing in stocks. I value the freedom to participate in legal, regulated markets like Kalshi, where I know there are rules in place to protect users.
One thing I find especially important is how informed trading improves price discovery. When people like me, who take the time to study data and trends, participate in these markets, the prices become more accurate. That benefits everyone, not just traders. For example, I've seen prediction market odds on election outcomes be far more reliable than polls or pundits. This kind of information is a public good. It helps journalists, policymakers, and regular citizens make sense of uncertain events. If you restrict access to only big institutions, you lose the diverse perspectives that make these markets so accurate. I think that's a mistake.
I also want to address a concern I know the CFTC has, specifically related to insider trading as mentioned in Questions 29-32 of the ANPR. I get why this is a worry, but I don't think the solution is to ban or over-restrict prediction markets. Insider trading is already illegal, and the CFTC has tools to enforce those laws. Punishing all participants by limiting these markets just because a few might act badly doesn't seem fair. Instead, focus on enforcing existing rules and ensuring platforms have strong monitoring in place. Informed trading isn't the same as insider trading, and it actually helps make prices more accurate for everyone.
I'm asking the CFTC to support proportionate regulation of prediction markets. Don't ban broad categories of contracts or make it impossible for regular people like me to participate. These markets are a valuable tool for learning, hedging, and contributing to better public information. Please craft rules that protect consumers while allowing innovation to thrive.
Sincerely,
Adam Talbot
