Comment Text:
Dear Chairman and Commissioners,
My name is Don Stalter, and I'm a trader and investor based in Nevada. I've been actively trading on prediction markets like Kalshi and Polymarket for a while now, and I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the development of well-regulated prediction markets in the United States, and I want to share why these markets are valuable to me and why proportionate regulation, not bans or over-restriction, is the right path forward.
A couple of years ago, I had a significant investment in a supply chain tech startup that was at risk due to a potential nationwide freight rail strike. The news was useless, just a mess of conflicting pundit opinions and political noise. I couldn't get a clear read on whether the strike would happen or not, and the uncertainty was a real threat to my portfolio. That's when I turned to a CFTC-regulated prediction market like Kalshi. It wasn't just a betting platform; it was a legitimate tool for hedging my risk. I took a position on the strike happening, not because I wanted it to, but because if it did, the payout would offset some of the hit to my investment. Even better, the market's real-time odds gave me a clearer picture than any poll or talking head ever could. The strike was averted in the end, and I lost my premium, but that was fine. It worked as insurance and gave me reliable information to make decisions. That experience showed me prediction markets aren't gambling; they serve a real economic purpose for people like me trying to manage uncertainty.
I'm particularly drawn to questions 7 and 8 in your ANPR about balancing innovation with consumer protection and the public interest benefits of these markets. Prediction markets offer unique forecasting power, often more accurate than polls, because they aggregate real money from informed traders. That benefits not just traders but anyone who needs better information, from businesses to policymakers. Also, regarding questions 15 and 16 on defining gaming versus legitimate markets, I urge you to recognize that event contracts aren't gaming. They involve research and judgment, just like trading stocks or commodities, and they help with price discovery and risk management.
On questions 29 through 31 about inside information, I believe informed trading actually improves price accuracy for everyone. Insider trading and manipulation are already illegal, and the CFTC has the tools to enforce those laws. Banning or overly restricting these markets to stop a few bad actors would punish the rest of us and push activity to unregulated offshore platforms, which are far less safe. The US should lead in financial innovation, not cede ground to other countries.
I ask you to support proportionate, targeted regulation that addresses specific risks without broad bans. Regulated markets like Kalshi are the safer choice, and they give people like me a way to hedge real risks and access better information. Please keep these markets accessible and thriving under fair rules.
Sincerely,
Don Stalter
