Comment Text:
Dear Chairman and Commissioners,
My name is Dennis Johnson, and I'm a trader and investor based in Texas. I've been actively trading on prediction markets like Kalshi and Polymarket for a while now, and I wanted to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I strongly support the idea of well-regulated prediction markets and believe the CFTC should focus on proportionate rules rather than broad restrictions or bans.
As someone who trades regularly, I've seen firsthand how prediction markets provide information you just can't get anywhere else. I've relied on these platforms to gauge outcomes of elections and other public events, and time and again, their forecasts have been more accurate than polls or pundits. This isn't just useful for me as a trader; it's valuable for anyone trying to understand what's really happening. I think allowing regular folks like me to participate makes the data better, since it brings in more perspectives. If only big institutions can play, all that insight stays locked up with them.
I also want to stress that trading on these markets isn't gambling. It takes research, judgment, and a real understanding of the world, just like trading stocks or commodities. I've spent hours digging into data to make informed trades, often to hedge against events that could impact my investments. Classifying event contracts as "gaming" would be a mistake; they serve real economic purposes, like price discovery and risk management. I urge the CFTC to consider this when addressing questions 15 through 22 on listed activities.
I'm also concerned about what happens if these markets get over-restricted or banned. I've traded on regulated platforms like Kalshi, which I trust because they're under CFTC oversight. But if access gets cut off, people like me will just turn to offshore alternatives like Polymarket, which don't have the same protections. Regulation is the way to keep consumers safe, not prohibition. This ties directly to questions 7 through 14 on public interest, where I believe the balance should tilt toward innovation with strong safeguards.
On manipulation and insider trading, I get the concern. But the CFTC already has powerful tools to tackle these issues in other markets. Those same tools can work here. Banning entire categories of contracts to stop a few bad actors punishes everyone else. I hope the CFTC, in looking at questions 29 through 32 on inside information, recognizes that informed traders often improve price accuracy, and existing laws already bar federal officials from abusing nonpublic info.
In closing, I ask the CFTC to support proportionate, targeted regulation for prediction markets. Don't ban or over-restrict them. Keep platforms like Kalshi accessible and safe for traders like me, and prevent activity from being pushed offshore. Thanks for considering my input.
Sincerely,
Dennis Johnson
