Comment Text:
Dear Chairman and Commissioners,
My name is Ryan DeWitt, and I'm a software engineer from California. Im writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. As someone who actively trades on platforms like Kalshi, I strongly support the development of well-regulated prediction markets in the United States. I believe they provide unique value to individuals like me, to businesses, and to society as a whole.
I started trading on prediction markets a couple of years ago as a way to supplement my income, but I quickly realized theyre more than just a side hustle. These markets let me hedge personal financial risks, like potential changes in interest rates that affect my mortgage decisions or policy shifts that could impact my tech career. Beyond that, the information I get from market prices is often sharper than what I find in news or polls, especially during election cycles. Ive seen firsthand how these platforms can cut through noise and provide real insights on public events. Thats not just useful for traders; its valuable for anyone trying to make informed decisions.
I want to address a few specific points from your ANPR. On the question of whether event contracts should be seen as gaming (around Questions 15-22), I strongly believe theyre not. Trading on these markets requires research, analysis, and judgment about real-world events, much like trading stocks or commodities. Classifying them as gambling ignores their economic purpose, like hedging risk or discovering accurate price signals. I also think the U.S. has a chance to lead in financial innovation here (relevant to Questions 7-14 on public interest). If we over-restrict these markets, we risk pushing activity to unregulated offshore platforms, which lack the consumer protections of CFTC-registered exchanges like Kalshi. Id much rather trade on a platform with oversight than be forced to less safe alternatives.
Im not blind to the risks of manipulation or insider trading (as raised in Questions 29-32). Those are real concerns. But the CFTC already has tools to tackle fraud and abuse in other derivatives markets. Use those tools here instead of broad bans. Shutting down prediction markets to stop a few bad actors would punish everyone else and kill the benefits they bring, like better forecasting and democratized access to information. Academic research, which Ive read as a data-driven tech professional, backs this up, showing how these markets aggregate information efficiently.
I urge you to support proportionate regulation that addresses specific risks without stifling innovation. Lets keep the U.S. at the forefront of financial technology and ensure platforms like Kalshi can operate safely under CFTC oversight. Thank you for considering my input.
Sincerely,
Ryan DeWitt
