Comment Text:
Dear Chairman and Commissioners,
My name is Michael Krynski, and I'm a software engineer based in Texas. Im writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. As someone who actively trades on platforms like Kalshi and Polymarket, I strongly support the development of well-regulated prediction markets in the United States. I believe they provide unique value to people like me and to society as a whole, and I urge the CFTC to craft rules that encourage innovation while addressing real risks.
I got into prediction markets a couple of years ago because, as a tech professional, Im always looking for data-driven insights. Ive found that these markets consistently outperform polls and pundits when it comes to forecasting elections and other public events. For example, last year I relied on market prices to get a clearer sense of election outcomes, which helped me make better-informed decisions for my small side business that could be impacted by policy changes. That kind of accuracy isnt just useful for traders; its valuable for anyone trying to understand whats likely to happen in the world.
Beyond forecasting, I use these markets to hedge personal financial risks. A contract on interest rate decisions or inflation data lets me offset some uncertainty around my budget and investments. This isnt gambling. Its a practical tool, much like trading stocks or futures based on research and judgment. I also value the freedom to participate in legal, regulated markets. Platforms like Kalshi, under CFTC oversight, give me confidence that there are rules in place to prevent manipulation. If the U.S. over-restricts or bans these markets, activity will just move to unregulated offshore platforms with no protections. Ive seen those sites, and theyre a far riskier place to trade.
Im also concerned about U.S. competitiveness. As someone in tech, I know how fast innovation moves. If we stifle prediction markets here, other countries will take the lead in this space. We should be setting the standard for financial innovation, not playing catch-up. And on the topic of informed trading, I believe it actually improves price discovery. When knowledgeable participants trade, the market prices get sharper, and that benefits everyone, not just those in the trade. This ties into academic research Ive read, which shows how prediction markets aggregate information efficiently. I think the CFTC should consider this in relation to Questions 7 and 29 from the ANPR, on public interest and the role of informed traders.
I get that there are concerns about insider trading or manipulation, but those are already illegal under existing laws. The CFTC has tools to enforce against bad actors without shutting down entire markets. Lets not punish the majority for the actions of a few. I ask that you support proportionate regulation that keeps prediction markets accessible, safe, and innovative here in the U.S.
Thank you for considering my perspective.
Sincerely,
Michael Krynski
