Comment Text:
Dear Chairman and Commissioners,
My name is Erik Makowski, and I'm just an everyday citizen from New York writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've used prediction markets a few times, and I believe they have real value for people like me. Im in support of regulating them properly, but not banning or over-restricting them, and Id like to explain why.
Ive placed a few trades on platforms like Kalshi, mostly to get a sense of how certain events might play out, like election outcomes or economic data releases. What struck me is how these markets provide information you cant find anywhere else. Theyre not just a game or a bet; theyre a tool for understanding the world. I dont see this as gambling at all. It takes research and judgment, much like investing in stocks. Classifying event contracts as gaming feels wrong to me because they serve a legitimate purpose, whether its figuring out whats likely to happen or even hedging against risks that affect my finances. Id urge the CFTC to consider this when addressing questions like 15 and 16 about defining gaming versus legitimate markets.
I also worry that banning or over-restricting these markets will push activity offshore to unregulated platforms. Ive seen ads for some of these overseas sites, and they look sketchy. No oversight, no consumer protections. A regulated market like Kalshi, under CFTC supervision, feels much safer. If you make it too hard to operate here, people wont stop trading; theyll just go where there are no rules. I think thats a worse outcome for everyone. This ties into questions 7 and 8 about balancing innovation and consumer protection. Regulation should keep us safe without killing off useful tools.
Another thing I want to point out is that the CFTC already has the power to deal with bad actors. Insider trading and market manipulation are illegal, and your agency has the tools to go after people who break the law. I dont think you need to create new bans or broad restrictions to handle these risks, as discussed in questions 29 through 32 on insider information. Use whats already in place. Punishing everyone by shutting down or over-regulating prediction markets because of a few cheaters doesnt seem fair.
Im not an expert, just someone who sees value in these markets. They give regular people like me a chance to engage with big events and make sense of uncertainty. I hope the CFTC will support proportionate regulation that addresses real risks without banning or overly restricting prediction markets. Lets keep them safe and accessible right here in the US.
Thank you for considering my input.
Sincerely,
Erik Makowski
