Comment Text:
Dear Chairman and Commissioners,
My name is Micheal Toredo, and I'm a trader and investor based in California. I've been actively trading on prediction markets like Kalshi and Polymarket for a while now, and Im writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I strongly support the development of well-regulated prediction markets in the United States, and I want to share my perspective as someone who uses these platforms regularly.
I rely on prediction markets for insights that I just can't get from polls or pundits. Whether it's an election outcome or a major public event, the prices on these markets often cut through the noise and give a clearer picture of whats likely to happen. I've seen firsthand how they outperform traditional forecasts, and I believe this kind of information is valuable not just to traders like me, but to the public at large. Beyond that, these markets let regular people like me participate in a financial system thats often dominated by big institutions. That freedom to engage in legal, regulated markets is something I value deeply.
I also think the U.S. needs to stay competitive in financial innovation. If we over-restrict or ban prediction markets, we risk pushing activity to unregulated offshore platforms, which are far less safe for consumers. I've traded on regulated platforms like Kalshi, and the transparency and oversight there make a huge difference compared to alternatives. Regulation, not prohibition, is the way to protect users while keeping the U.S. at the forefront of this space. On top of that, I believe event contracts shouldn't be labeled as gaming. They serve real economic purposes, like forecasting and hedging, and treating them as gambling misses the point of their value.
Looking at some of the specific questions in the ANPR, Id like to address a few from the Public Interest section, like Question 7 on balancing innovation and consumer protection. I think the answer lies in strong oversight of platforms, not in shutting them down. Also, regarding Question 15 in the Listed Activities section about defining gaming, I urge the CFTC to recognize that these contracts are rooted in research and judgment, much like any other investment. Finally, on Question 29 from the Inside Information section, I believe the existing laws against insider trading are enough to handle bad actors without punishing everyone else by restricting access.
I'm not blind to the risks of manipulation or misuse, but the CFTC already has tools to tackle those issues. Banning or over-restricting prediction markets would only drive activity to less safe corners of the internet. I hope the Commission will support proportionate regulation that allows these markets to thrive while addressing legitimate concerns.
Thank you for considering my input.
Sincerely,
Micheal Toredo
