Comment Text:
Dear Chairman and Commissioners,
My name is Aaron Alexander, and I'm a trader and investor based in Texas. I've been actively trading on prediction markets like Kalshi for a while now, and Im writing to express my strong support for proportionate regulation of these markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe well-regulated prediction markets provide real value to people like me and to society as a whole, and I want to share my perspective on why they shouldn't be over-restricted or banned.
As someone who trades regularly, I can tell you that event contracts are not gambling. They serve legitimate economic purposes, like helping me make informed decisions and manage risks tied to real-world events. Whether it's an election outcome that could impact my investments or a policy change that might affect markets Im exposed to, trading on Kalshi gives me access to unique information through price discovery. Its not a game of chance; it takes research and judgment, just like trading stocks or commodities. Labeling these contracts as "gaming" feels like a misunderstanding of their purpose, and I urge the CFTC to recognize their value in hedging and information aggregation when considering questions like 15 and 16 on defining gaming versus legitimate markets.
I also want to stress that regulated platforms like Kalshi are far safer than the alternative. If heavy restrictions or bans push trading to unregulated offshore sites, participants like me lose the protections that come with CFTC oversight. Those offshore platforms don't have the same transparency or accountability, and thats a bigger risk to consumers than anything happening on a regulated exchange. On questions 7 and 8 about balancing innovation and consumer protection, I believe supporting regulated markets is the best way to protect traders while allowing innovation to thrive.
Finally, I think informed trading actually helps everyone. When people with knowledge trade, it improves price accuracy, which benefits all market participants, not just the traders. Regarding questions 29 and 30 on inside information, Id argue that the CFTC should focus on enforcing existing laws against insider trading rather than limiting these markets. Banning or over-regulating prediction markets to stop a few bad actors punishes the majority of us who trade honestly and rely on these tools.
Prediction markets have become an important part of how I navigate uncertainty as an investor. I respectfully ask the CFTC to craft rules that support their growth under fair regulation, without broad prohibitions or misclassifications that could stifle their benefits. Thank you for considering my input.
Sincerely,
Aaron Alexander
