Comment Text:
Dear Chairman and Commissioners,
My name is Keaka Gomes, and I'm a trader and investor from Hawaii. I've been actively trading on prediction markets like Kalshi for a while now, and I'm writing to share my support for well-regulated prediction markets in response to your Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these markets offer real value to people like me and to society as a whole, and I want to explain why I think the CFTC should regulate them proportionately, not ban or over-restrict them.
As someone who trades regularly, I value the freedom to participate in legal, regulated markets. Platforms like Kalshi give me a way to engage with real-world events, whether it's an election outcome that could impact my taxes or a Federal Reserve decision that affects my investments. This isn't gambling, no matter what some might say. Trading on prediction markets requires research, analysis, and judgment, just like trading stocks or commodities. These event contracts serve a genuine economic purpose, helping me hedge risks and make informed decisions. I also see how the prices on these markets provide better information than polls or pundits. That kind of price discovery isn't just useful to traders; it helps the public and even policymakers understand what might happen next.
I'm especially concerned about the idea of banning or heavily restricting these markets, because I've seen what happens when regulation goes too far. If the CFTC makes it impossible to trade on regulated platforms like Kalshi, people won't just stop trading. They'll move to unregulated offshore sites that don't have the same safeguards or oversight. I feel much safer trading on a CFTC-regulated platform where there are rules against manipulation and fraud. Pushing activity offshore would be a step backward, and I hope the CFTC considers this when looking at questions like 7 and 8 in your ANPR about balancing innovation and consumer protection.
Another point I want to make is about informed trading. I know there's worry about insider trading, as discussed in questions 29 and 30, but I believe traders with good information actually improve price discovery. When someone knows something and trades on it legally, the market price gets closer to the truth, and that benefits everyone. The CFTC already has laws and tools to handle actual insider trading or manipulation. Punishing all of us by shutting down markets because of a few bad actors doesn't seem fair or logical.
I urge you to support prediction markets with fair, targeted regulations that address specific risks without overreaching. Keep platforms like Kalshi accessible to everyday traders like me, and don't push activity to less safe, offshore venues. Thank you for considering my perspective.
Sincerely,
Keaka Gomes
