Comment Text:
Dear Chairman and Commissioners,
My name is Daniel Lara, and I'm a trader and investor based in California. I've been actively trading on prediction markets like Kalshi for a while now, and Im writing to express my strong support for well-regulated prediction markets in response to your Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these markets offer unique value to individuals like me, as well as to society at large, and I urge the CFTC to regulate them proportionately rather than impose broad restrictions or bans.
As someone who trades regularly, I see firsthand how prediction markets provide information you can't get anywhere else. The prices reflect real-world probabilities better than polls or pundits, and that benefits everyone, not just traders. Ive used these markets to hedge personal financial risks tied to economic events, like inflation data releases that impact my investment decisions. This isn't gambling, it's a legitimate tool for managing uncertainty, much like trading stocks or commodities. Classifying event contracts as "gaming" (as discussed in Questions 15-22) ignores their real economic purpose, whether it's hedging or price discovery.
I also value the freedom to participate in legal, regulated markets. Platforms like Kalshi, operating under CFTC oversight, are far safer than unregulated offshore alternatives. If the U.S. over-restricts or bans these markets, activity will just move to less secure venues where consumer protections are nonexistent. Id rather see the CFTC focus on targeted rules to address specific risks like manipulation or insider trading (as raised in Questions 29-32) than impose categorical prohibitions. Informed trading, by the way, improves price discovery and makes markets more accurate for everyone. The answer isnt to ban markets but to enforce existing laws against insider trading and manipulation, which the CFTC already has the power to do.
Beyond my personal stake, I worry about U.S. competitiveness. Prediction markets are a form of financial innovation, and the U.S. should lead in this space, not cede ground to other countries (relevant to Questions 7-14 on public interest). Proportionate regulation can balance consumer protection with innovation, ensuring markets remain safe and accessible without driving participants offshore.
Ive seen how these markets democratize access to information and risk management tools. Shutting them down or over-regulating them would hurt regular people like me while big institutions find workarounds. So, I ask the CFTC to support regulated prediction markets with rules that tackle real risks without stifling their benefits. Lets keep these markets legal, safe, and open to all.
Thank you for considering my input.
Sincerely,
Daniel Lara
