Comment Text:
Dear Chairman and Commissioners,
My name is Alexander Morain, and I'm a software engineer based in Illinois. Ive been working in tech for several years, often dealing with data and systems that rely on accurate information. Thats why Im writing to you about the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I actively trade on platforms like Kalshi, and I strongly support well-regulated prediction markets. I believe they provide unique value to society and to people like me who want to engage with real-world events in a meaningful way.
As someone who crunches numbers and analyzes trends for a living, I cant overstate how impressive prediction markets are at producing forecasts. Ive seen firsthand how platforms like Kalshi often outshine polls or pundits when it comes to predicting election outcomes or economic indicators. This isnt just useful for traders; its valuable information for everyone, from journalists to policymakers. Beyond that, trading on these markets isnt gambling. Its a process of research and judgment, much like investing in stocks. I spend hours reading up on policies or economic reports before placing a trade. To me, event contracts serve a real economic purpose, whether its hedging against uncertainty or gaining insight into future events.
I also worry about what happens if the CFTC over-restricts these markets. Regulated platforms like Kalshi, operating under CFTC oversight as a designated contract market, are safe and transparent. If you impose broad bans or overly harsh rules, people will just turn to unregulated offshore platforms, which are far riskier and lack accountability. The US has a chance to lead in financial innovation here. We shouldnt cede that ground to other countries by stifling a growing industry. Instead, I urge you to focus on proportionate regulation that targets specific risks, like manipulation or insider trading, without shutting down entire categories of contracts.
On that note, I want to address some of the questions in your ANPR. Regarding Questions 29-32 on inside information, I believe informed trading actually improves price discovery. When knowledgeable traders participate, the market reflects better information, which benefits everyone. The CFTC already has tools to tackle insider trading abuses, and those should be enforced rather than banning markets altogether. As for Questions 7-14 on public interest, I think innovation and consumer access should weigh heavily. These markets let regular people like me engage with events that impact our lives, and thats a public good.
I ask that you support proportionate regulation of prediction markets. Dont let broad restrictions or categorical bans undermine their potential. Keep the US at the forefront of financial innovation while ensuring fair, safe markets for participants.
Sincerely,
Alexander Morain
