Comment Text:
Dear Commissioners,
I am writing to express my support for Kalshi's event prediction contracts, particularly those related to congressional control. As a financial analyst based in Richmond, Virginia, I understand the crucial role these contracts play in hedging against political uncertainties that directly impact market dynamics. The availability of these contracts could provide market participants with a reliable tool to manage risk associated with potential shifts in congressional power. For instance, businesses in sectors sensitive to regulatory changes could use these contracts to offset financial exposures stemming from differing legislative agendas. This ability to hedge not only stabilizes business operations but also contributes to overall market efficiency by ensuring more informed investment decisions.
Furthermore, the assertion that these contracts constitute "gaming" under CFTC Rule 40.11 overlooks their substantive role in risk management for entities not traditionally involved in gambling activities. Instead, these contracts offer legitimate hedging opportunities, akin to other widely accepted financial instruments used across regulated markets.
In conclusion, I urge the CFTC to consider the broader public interest in fostering a regulated environment where market participants can responsibly manage political risk. Approving these contracts would align regulatory oversight with market demand, enhancing transparency and market integrity.
Sincerely,
David
