Comment Text:
Dear Chairman and Commissioners,
My name is Will Noddings, and I'm a trader and investor based in California. I've been actively trading on prediction markets like Kalshi for a while now, and I wanted to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the development of well-regulated prediction markets in the United States, and I hope the CFTC will approach this with proportionate rules rather than overly restrictive bans.
As someone who trades regularly, Ive seen firsthand how prediction markets provide information that you just cant get from polls or pundits. For elections and other public events, the prices on these markets often cut through the noise and give a clearer picture of whats likely to happen. This isnt just helpful for traders like me; its valuable for the public, media, and even policymakers who need better data to make decisions. I also use these markets to hedge real risks that affect my investments, like political outcomes or economic policy changes. Its not gambling, its a legitimate tool for managing uncertainty, much like trading stocks or commodities.
Im concerned that over-restricting or banning these markets would push activity to unregulated offshore platforms, which are far less safe for consumers. Id much rather trade on a regulated market like Kalshi, where theres oversight, than take my chances with some sketchy overseas site. The CFTC already has strong tools to prevent manipulation and insider trading in other derivatives markets. I believe those can be adapted here without resorting to broad categorical bans. Plus, informed trading actually improves price discovery, benefiting everyone in the market, not just a few insiders.
On specific questions in the ANPR, Id like to address a couple from the Public Interest and Listed Activities sections. For Question 7, on balancing innovation and consumer protection, I think regulated prediction markets strike that balance by fostering innovation while keeping traders safe under CFTC oversight. For Question 15, about defining gaming versus legitimate markets, I urge you to recognize that event contracts serve real economic purposes like hedging and price discovery. They shouldnt be lumped in with gambling.
The US has a chance to lead in financial innovation with prediction markets. If we clamp down too hard, other countries will take the lead, and American traders like me will lose out. Im all for rules that target specific risks, but broad prohibitions would hurt more than help. I hope the CFTC will support proportionate regulation that allows these markets to grow while protecting consumers.
Thank you for considering my input.
Sincerely,
Will Noddings
