Comment Text:
Dear Chairman and Commissioners,
My name is Keona Chaves Keawe, and I'm writing to you as an everyday citizen from Hawaii regarding the Advance Notice of Proposed Rulemaking on Prediction Markets, published in 91 FR 12516. I actively trade on prediction markets like Kalshi and Polymarket, and I want to share why I believe these markets are valuable and why the CFTC should support them with fair, proportionate regulation instead of heavy-handed restrictions.
Living in Hawaii, I face unique financial risks tied to things like weather events, shipping costs, and tourism swings, which impact my personal budget and local economy. Trading on prediction markets has given me a way to hedge some of those uncertainties. For example, I've used these platforms to offset risks related to energy price spikes after storms, which hit hard here on the islands. This isn't just play money to me; it's a practical tool, much like how farmers or businesses might hedge crop prices or regulatory changes. I believe many others could benefit from this kind of access too.
I also value the freedom to participate in legal, regulated markets. Platforms like Kalshi, which operate under CFTC oversight, give me confidence that there are rules in place to protect consumers like me. If we over-restrict or ban these markets, people won't stop trading; they'll just move to unregulated offshore platforms with no protections at all. I've seen what those look like, and they're far riskier. Regulation, not prohibition, is the way to keep participants safe.
On another note, I don't see prediction markets as gambling. They're about research and informed judgment, not luck. When people trade based on real knowledge, it improves price discovery, and that benefits everyone, not just traders. The information these markets provide is often more accurate than polls or news, and that's a public good. I'm also worried that if we clamp down too hard, the U.S. will lose its edge in financial innovation. We should be leading on this, not letting other countries take over.
Id like to address a couple of specific questions from the ANPR. Regarding Questions 7 and 8 under Public Interest, I believe prediction markets balance innovation with consumer needs when regulated properly, as they provide unique risk management tools. For Questions 29 and 30 on Inside Information, I think informed trading helps price accuracy, and existing laws already cover insider trading abuses. We don't need broad bans; we need targeted enforcement.
I'm asking the CFTC to support prediction markets with reasonable, focused regulations that address specific risks without shutting down entire categories of contracts. Let everyday people like me continue to use these tools safely and keep the U.S. at the forefront of innovation. Thank you for considering my perspective.
Sincerely,
Keona Chaves Keawe
