Comment Text:
Dear Chairman and Commissioners,
My name is Sean Parke, and I'm a student from Texas writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've been actively trading on platforms like Kalshi for a while now, and I strongly support the idea of well-regulated prediction markets. I believe they serve a real purpose for people like me and for society as a whole.
As a student, I don't have a ton of money to throw around, but I do care about understanding the world around me. Prediction markets give me a way to engage with big events, like elections or economic shifts, in a meaningful way. The prices on these platforms often tell me more about what's likely to happen than any news outlet or poll. That's not just helpful for me when I trade; it's useful information for everyone. Beyond that, I use these markets to hedge small personal risks. For example, I've placed trades to offset potential impacts of election outcomes on my family's small business taxes here in Texas. This isn't gambling. It takes research and judgment, just like investing in stocks or anything else. Calling event contracts "gaming" feels like a misunderstanding of what they really are.
I'm also worried about what happens if these markets get over-restricted or banned. I've seen unregulated offshore platforms out there, and they're nowhere near as safe or transparent as a regulated market like Kalshi. If the CFTC cracks down too hard, people won't stop trading; they'll just go to those sketchy sites instead. That seems like a step backward. Plus, I think the US should be leading the charge on financial innovation. We shouldn't let other countries take the lead while we sit on the sidelines. This ties into questions 7 and 8 from your ANPR, about balancing innovation with consumer protection. I think regulation can achieve both if it's done thoughtfully, without shutting down entire markets.
I get that there are concerns about manipulation or insider trading, as raised in questions 29 through 32. But those issues are already illegal, and the CFTC has tools to enforce against bad actors. Banning or over-restricting prediction markets punishes regular people like me who just want to participate in a legal, transparent system. I hope you'll focus on targeted rules to address specific risks rather than broad prohibitions.
In closing, I urge the CFTC to support proportionate regulation of prediction markets. Allow platforms like Kalshi to operate under clear, fair rules that protect consumers without stifling innovation or pushing activity offshore. Thank you for considering my perspective as a student who values the freedom to participate in these markets.
Sincerely,
Sean Parke
