Comment Text:
Public Comment: RIN 3038-AF65 (Prediction Markets)
Date: 04/30/26
The Commission should be aware of something before weighing the public comments it receives on this rulemaking: Kalshi emailed its entire user base — myself included — soliciting pro-prediction market comments to submit to the CFTC. It built a dedicated AI tool at (comments-campaign.kalshi.com) to make this as frictionless as possible. The tool asks users a few questions and generates a "personalized, professional comment letter to the CFTC" on their behalf — one that, by the site's own description, is explicitly "built to support well-regulated prediction markets." There is no option to express ambivalence. There is no option to raise concerns. The tool produces only one kind of comment, in one direction, at industrial scale, and routes it directly to the Commission's comment portal. The Commission should weigh comments generated by this tool accordingly — they are a coordinated astroturfing campaign by a regulated entity attempting to influence its own regulator, not organic public input. That Kalshi felt it necessary to manufacture public support in this way is itself telling.
It is telling because the genuine public record — the one not generated by Kalshi's AI — looks very different. Courts in Arizona, Massachusetts, and Ohio have found Kalshi's products to constitute illegal gambling. Nineteen federal lawsuits are pending over its legality. The company has been criminally charged in Arizona, obtained a preliminary injunction in Massachusetts banning its sports contracts, and faces a $54 million class-action lawsuit for refusing to pay out winning bets. It hired a 15-year-old to market its platform, ran a college campus ambassador program explicitly designed to recruit students because, according to a Kalshi supervisor, they "spend money recklessly," and generates 90% of its revenue from sports betting — a product indistinguishable from what licensed sportsbooks offer but without a single consumer protection requirement that those sportsbooks must meet.
The Commission asked for public comment on how prediction markets should be regulated. Kalshi's answer was to build a machine that floods this record with synthetic support. My answer is this: a company that responds to regulatory scrutiny by manufacturing astroturf rather than addressing the documented harms it has caused does not deserve the DCM designation that makes its entire business model legal. Revoke it.
