Comment Text:
Dear Chairman and Commissioners,
My name is James Gardner, and I'm a software engineer from Minnesota. Im writing to comment on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. As someone who works in tech and actively trades on platforms like Kalshi, I rely on these markets for statistical analysis and forecasting. I strongly support well-regulated prediction markets and want to see them protected under fair, proportionate rules.
For me, prediction markets aren't just a hobby. They're a unique source of information. I've used platforms like Kalshi to analyze election outcomes and other public events, and the data I get from market prices often feels more reliable than what I see in polls or hear from pundits. As a tech professional, I value how these markets aggregate information efficiently, turning scattered opinions into clear probabilities. This isn't gambling, it's a tool for better decision-making, both for me personally and for society as a whole. The idea that event contracts could be classified as "gaming" doesn't hold up. They serve real economic purposes, like price discovery and even hedging risks. For instance, I've used these markets to hedge against policy changes that could impact my freelance tech contracts.
I also believe the U.S. should be a leader in financial innovation. If we over-restrict or ban prediction markets, we're just pushing activity to unregulated offshore platforms with no oversight. I've seen firsthand how a secure, CFTC-regulated environment like Kalshi offers protections that you won't find in some sketchy overseas site. Driving users away from safe domestic markets seems like the exact opposite of what we should be doing.
I want to address a few of the specific questions in the ANPR. On Question 7, regarding public interest, I think prediction markets clearly benefit the public by providing better forecasting and incentivizing informed civic engagement. On Question 29, about inside information, I believe informed trading actually improves price discovery and helps everyone, not just traders. The CFTC already has robust tools to tackle manipulation and insider trading in other markets, and those can be applied here without resorting to broad bans. Targeted regulation, not categorical restrictions, is the way to go.
I'm not blind to the risks. Manipulation and insider trading are real concerns, but banning entire markets to stop a few bad actors punishes everyone else. Let's use the existing laws and adapt them as needed. I urge the Commission to support proportionate rules that allow prediction markets to thrive legally and transparently in the U.S. Don't let heavy-handed restrictions drive innovation and users offshore.
Thank you for considering my perspective.
Sincerely,
James Gardner
