Comment Text:
Dear Chairman and Commissioners,
My name is Joseph Perez, and I'm just a regular citizen from California writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. Ive been trading on platforms like Kalshi for a while now, and I strongly support well-regulated prediction markets. I believe theyre a fair and useful tool for people like me, and I hope the CFTC will create rules that let us keep participating without over-restricting or banning these markets.
I enjoy trading on prediction markets because they level the playing field in a way the stock market doesnt. Ive seen how insider trading seems to run rampant in regulated stock markets, with big players often getting away with it. Prediction markets, on the other hand, feel more accessible to the average person. I can trade on things I care about or understand, like election outcomes or economic indicators, and use them to hedge personal risks. For instance, Ive placed trades to offset potential financial hits from policy changes that could affect my budget. This isnt gambling to me. Its a practical way to manage uncertainty, much like any other investment.
I also value the information these markets provide. The prices often reflect a clearer picture of whats likely to happen than polls or news pundits. Thats helpful not just for traders, but for anyone trying to make sense of the world. Regarding your questions 7 and 8 on public interest and price discovery, I believe prediction markets serve a real purpose by aggregating knowledge and making it public. Informed trading, as mentioned in question 29, actually improves this process and benefits everyone by sharpening the accuracy of the data.
Im aware of concerns about manipulation or insider trading, but I dont think banning or heavily restricting these markets is the answer. The CFTC already has strong tools to tackle bad actors, as youve used in other derivatives markets. Plus, regulated platforms like Kalshi are far safer than unregulated offshore sites. If you over-restrict, people will just move to those less safe options. On questions 15 and 16 about gaming, I urge you not to classify event contracts as gambling. They serve legitimate economic purposes like hedging and information discovery, not just entertainment. Targeted rules for specific risks make more sense than broad bans.
Im asking the CFTC to support proportionate regulation that lets regular folks like me keep participating in legal, regulated prediction markets. Dont shut down a valuable tool because of a few potential bad actors. Focus on enforcing the rules you already have and keep innovation alive in the U.S.
Thank you for considering my input.
Sincerely,
Joseph Perez
