Comment Text:
Dear Chairman and Commissioners,
My name is Jacob Moncayo, and I'm an everyday citizen from Arizona. I've been actively trading on prediction markets like Kalshi for a while now, and Im writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support well-regulated prediction markets and believe they provide real value to people like me and to society as a whole.
I started trading on Kalshi because I wanted better information about things like elections and major public events. I've found that prediction markets often give more accurate forecasts than polls or pundits on TV. Thats not just helpful for me as a trader; its useful for everyone who wants to understand whats really likely to happen. These markets also let regular people like me participate in a fair, legal, and regulated space. I dont think thats something to restrict. If anything, keeping these markets open and accessible makes the information they produce even better, since more voices are included.
I also see prediction markets as a tool for managing real risks. For instance, Ive used them to hedge against outcomes like policy changes that could affect my personal finances. This isnt gambling in my view. It takes research and judgment, just like investing in stocks. Classifying event contracts as gaming feels wrong when they serve legitimate purposes like price discovery and risk management. Im also aware of academic research showing how these markets improve information transparency, which helps not just traders but the public and even policymakers make better decisions.
On the concerns some raise, like manipulation or insider trading, I get it. Those are real issues. But the CFTC already has strong tools to tackle fraud and abuse in other markets, and those can work here too. Banning or over-restricting prediction markets doesnt solve the problem; it just pushes activity to unregulated offshore platforms where theres no oversight at all. Thats worse for everyone. Plus, informed trading often makes prices more accurate, which benefits all participants, as long as its not based on illegal insider info.
Id like to address a couple of specific questions from the ANPR. On Question 7, about balancing innovation and consumer protection, I think the U.S. should lead in financial innovation. We shouldnt cede this space to other countries by over-regulating. And on Question 15, regarding defining gaming, I urge the CFTC to recognize that event contracts arent gambling when they serve economic purposes like hedging or forecasting.
In closing, I ask the CFTC to support proportionate, targeted regulation of prediction markets. Dont ban or overly restrict them. Focus on specific risks with the tools you already have. Keeping these markets regulated and accessible, like Kalshi, ensures safety and fairness while preserving their benefits.
Thank you for considering my input.
Sincerely,
Jacob Moncayo
