Comment Text:
Dear Chairman and Commissioners,
My name is Lucas Jennings, and I'm a trader and investor based in Florida. 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 provide unique value to people like me, as well as to the broader public, and I urge you to adopt proportionate regulations rather than overly restrictive rules or bans.
As a trader, I rely on prediction markets for accurate forecasting of events like elections and economic indicators. Time and again, these markets have proven more reliable than polls or pundits. The aggregated wisdom of many participants creates information you just can't get elsewhere, and that benefits not only traders but also the media, policymakers, and everyday citizens trying to make sense of the world. Beyond forecasting, I use these markets to hedge personal financial risks. For example, Ive traded contracts tied to election outcomes that could impact tax policies affecting my investments. This isn't gambling; it's a practical tool, much like trading futures or options to manage risk.
Im also concerned about the alternative if these markets are over-regulated or banned. Right now, platforms like Kalshi operate under CFTC oversight, which offers consumer protections I trust. If you restrict these markets too much, activity will just move to unregulated offshore platforms with no safeguards. I've seen what happens in less regulated spaces, and its not pretty. Keeping prediction markets legal and regulated here in the U.S. is the safer choice. Plus, the U.S. should be leading in financial innovation, not handing that edge to other countries.
I want to address some specific questions from your ANPR. On Questions 7-14 under Public Interest, I believe prediction markets serve the public good through price discovery and risk management. Theyre not gaming; they have real economic purpose, similar to other derivatives. On Questions 29-32 about inside information, I think informed trading actually improves price accuracy and benefits everyone in the market. The CFTC already has strong tools to tackle manipulation and insider trading in other markets, and those can be applied here without broad bans. Finally, on Questions 15-22 about listed activities, I urge you not to classify event contracts as gaming. Theyre a legitimate financial instrument, and overbroad restrictions would hurt regular traders like me.
I understand concerns about manipulation or misuse, but banning or severely limiting prediction markets punishes honest participants and pushes activity to riskier venues. Targeted, proportionate regulation is the answer. I ask you to support a framework that allows these markets to thrive under clear, fair rules while addressing specific risks with the tools you already have.
Thank you for considering my input.
Sincerely,
Lucas Jennings
