Comment Text:
Dear Commissioners,
I am a long time trader on political prediction markets, going back to the Dublin-based Intrade and I am currently active on both PredictIt and Kalshi. I strongly urge the commission to approve election-based markets on both platforms. The general public is strongly supportive of regulated betting markets, rather than the government imposing restrictions of the type of markets available to consumers. A legal, regulated and taxed political betting market is much safer to consumers than a black market that has no processes in place to detect market manipulation and consumer fraud. The integrity of elections today is far more threatened by political actors, both domestically and abroad, who seek to undermine the fairness and trust in our democratic electoral system. Clamping down on average Americans who seek a platform to trade with one another on their political predictions and have fun doing it, is overhanded government interference and is more likely to have the opposite effect.
Due to the recent crackdown on PredictIt, I have seen more and more users place side bets with each other on election outcomes. And the result has not been positive with notable examples of bettors welching on their bets. The community is turning to escrow companies to protect their bets which carries its own problems. This is not the type of betting environment we should be operating in today given the proliferation of all other types of betting both online and at brick and mortar establishments.
There are no examples, literally any, of prediction markets compromising the integrity of an election. The UK and many other European countries with vibrant democracies have open, liberalized political betting without incident.
I urge the commission to approve Kalshi's request to add election markets to its platform and to reinstate the No-Action letter to PredictIt. An open, regulated market will allow governmental oversight, healthy competition, and consumer protections that benefit ordinary investors by ensuring a fair market, lower trading fees, and the availability of markets that people want to trade on. And finally, it is likely to encourage greater interest, debate and participation in elections and our political system.
Yehuda Sugarman
