Comment Text:
Dear Chairman and Commissioners,
My name is Carlos Ramirez, and I'm just a regular citizen from the United States who has taken an interest in prediction markets. I've been trading on platforms 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 well-regulated prediction markets, and I hope my perspective as an everyday trader can help inform your approach.
I got into prediction markets because they offer insights I can't find anywhere else. Whether it's an election outcome or an economic indicator like a CPI report, the prices on these markets often predict events more accurately than polls or TV pundits. I've seen this firsthand, and it helps me make better decisions, even outside of trading. This isn't just useful for me; I believe it benefits society when we have access to better information. Plus, allowing regular folks like me to participate makes the system fairer. If only big institutions could trade, they'd hoard all the insights. Democratizing access improves the accuracy of these markets and gives us a stake in understanding the world around us.
I also use prediction markets to hedge real risks. For example, I've placed trades on election outcomes that could impact my taxes or small personal investments. This isn't gambling; it's a practical tool, much like buying insurance or investing in stocks. It takes research and judgment, not luck. That's why I find it frustrating when event contracts are labeled as "gaming." They serve a legitimate economic purpose, and I urge you to recognize that in your rules, especially in response to Questions 15-22 on listed activities.
I'm also concerned about consumer protection, which ties into Questions 7-14 on public interest. Regulated platforms like Kalshi are safe and transparent, with oversight to prevent manipulation. If you over-restrict or ban these markets, people will just turn to unregulated offshore sites, which are far riskier. I've read academic research, like studies by economists such as Wolfers and Zitzewitz, showing how prediction markets aggregate information efficiently. We should build on that, not push it underground. And honestly, the US should be leading the charge in financial innovation. If we don't, other countries will step in and take the lead.
I know there are concerns about insider trading or manipulation, but those are already illegal, and the CFTC has tools to address them. Banning or over-regulating prediction markets punishes honest participants like me instead of targeting bad actors. I ask that you craft proportionate regulations that protect consumers while allowing these markets to thrive. Please don't let fear of a few bad apples spoil a system that benefits so many.
Thank you for considering my input. I hope you'll support a framework that keeps prediction markets accessible and regulated here in the US.
Sincerely,
Carlos Ramirez
