Comment Text:
Dear Chairman and Commissioners,
My name is Bryan Arias, and I'm just a regular citizen from California writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I've been actively trading on platforms like Kalshi, and I strongly support the idea of well-regulated prediction markets. I believe they offer real value to people like me and to society as a whole, and I hope the CFTC will create rules that allow these markets to thrive without over-restricting them.
I got into prediction markets because I saw how they provide information you can't find anywhere else. The prices on these platforms often predict outcomes better than polls or pundits, and that helps me make smarter decisions, whether it's about my personal finances or just understanding what's happening in the world. Beyond that, I use these markets to hedge real risks. For example, I've traded contracts tied to economic indicators like inflation data because it affects my budget for rent and groceries. This isn't gambling to me. It takes research and judgment, just like investing in stocks. Classifying event contracts as "gaming" feels wrong when they serve legitimate economic purposes like price discovery and risk management.
I'm also worried about what happens if the CFTC over-regulates or bans these markets. Platforms like Kalshi, which operate under CFTC oversight, are safe and transparent. If access is restricted, people will just turn to unregulated offshore sites that offer no consumer protections. I've seen how those platforms work, and they're far riskier. Regulation should keep us in safe, U.S.-based markets, not push us away. On a broader level, I think the U.S. should be a leader in financial innovation. If we stifle prediction markets, other countries will step in and take the lead, and we'll lose out.
I appreciate that the CFTC is asking tough questions, especially around manipulation and insider trading in areas like Topic E (Questions 29-32). I agree those are real concerns, but I believe informed trading actually improves price discovery and helps everyone by making market predictions more accurate. The answer isn't to ban these markets but to enforce the existing laws against insider trading and manipulation. You already have the tools for that.
I'm not an expert, but I've read some of the academic research on prediction markets, and it backs up their value in aggregating information. That transparency benefits not just traders but the public too. So, when it comes to questions in Topic B (Questions 7-14) about public interest, I think the balance should lean toward supporting innovation while protecting consumers through smart regulation, not outright restrictions.
In closing, I urge the CFTC to support proportionate rules for prediction markets. Don't ban or overly restrict them. Allow regular people like me to participate in legal, regulated markets that provide real economic benefits. Thank you for considering my input.
Sincerely,
Bryan Arias
