Comment Text:
Dear Chairman and Commissioners,
My name is Paul Felix, and I'm a trader and investor based in Texas. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've been actively trading on platforms like Kalshi and Polymarket for a while now, and I believe these markets offer unique value that deserves fair and balanced regulation, not heavy-handed restrictions.
As someone who spends a lot of time analyzing markets, I can tell you that prediction markets consistently produce forecasts that are more accurate than polls or pundits. I've seen this firsthand. For instance, during the last election cycle, I watched prediction market odds on platforms like Kalshi reflect shifts in voter sentiment days before any poll caught up. That kind of real-time, aggregated insight isn't just helpful for traders like me, its valuable for anyone trying to understand whats really happening, whether that's journalists, businesses, or even policymakers. If we restrict or ban these markets, we lose access to a tool that cuts through the noise better than almost anything else.
I also care deeply about my freedom to participate in legal, regulated markets. Prediction markets aren't gambling, despite what some might say. They require research, analysis, and judgment, just like trading stocks or commodities. I put in hours reading reports, following news, and weighing probabilities before making a trade. Shutting down or over-regulating these platforms would take away my right to engage in a legitimate financial activity. Plus, regulated markets like Kalshi are a safer bet than pushing activity to offshore, unregulated platforms where there's no oversight at all. I'd much rather trade under the CFTC's watch than in some gray area.
Regarding some of the specific questions in the ANPR, I want to address Question 7 on balancing innovation and consumer protection. I think the CFTC can protect consumers by focusing on transparency and enforcing existing rules against manipulation and insider trading, rather than broad bans. And on Question 15, about defining gaming versus legitimate markets, I strongly believe prediction markets serve a real economic purpose through price discovery and hedging, not just entertainment. They shouldn't be lumped in with casino-style betting.
I know there are concerns about things like insider trading or manipulation, and those aren't trivial. But the CFTC already has the authority to crack down on bad actors. Banning or severely limiting prediction markets punishes honest participants like me instead of targeting the actual problems.
I'm asking you to support proportionate regulation that allows prediction markets to operate while addressing specific risks with targeted rules. Don't shut down a valuable tool just because a few might misuse it. Thanks for considering my perspective.
Sincerely,
Paul Felix
