Comment Text:
Dear Chairman and Commissioners,
My name is Johnathon Hampton, and I'm a trader and investor based in Virginia. I've been actively trading on prediction markets like Kalshi and Polymarket for a while now, and I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the idea of well-regulated prediction markets, and I want to explain why I think the CFTC should focus on proportionate regulation instead of overly restrictive rules or bans.
As someone who spends a lot of time researching and trading on these platforms, I can tell you that making educated predictions doesn't feel like gambling at all. It's about analyzing data, following news, and making informed decisions, much like I do with stocks or other investments. Event contracts aren't just games; they serve real economic purposes. I've used them to hedge risks tied to economic events like inflation data releases that affect my portfolio. Classifying these as "gaming" would be a mistake, and I urge the CFTC to recognize their legitimate value, especially in response to questions 15-22 about defining gaming versus legitimate markets.
I also believe that regulated markets like Kalshi, which operate under CFTC oversight, are far safer for people like me than unregulated offshore platforms. If the CFTC bans or over-restricts prediction markets, it won't stop trading; it will just push people like me to less secure, offshore alternatives where there's no consumer protection at all. I've seen firsthand how a regulated environment provides transparency and accountability. Addressing questions 7-14 on public interest, I think the balance between innovation and consumer protection lies in keeping these markets regulated domestically, not driving them away.
On top of that, the US should be leading the charge in financial innovation. If we impose heavy-handed rules, we're just handing the advantage to other countries. I've traded on platforms that could easily move overseas if the environment here gets too hostile. Let's keep the US competitive, as touched on in questions 33-40 about costs and benefits.
Finally, I want to stress that broad categorical bans aren't the answer. Targeted, proportionate regulation can address specific risks like manipulation or insider trading without punishing everyone. The CFTC already has tools to handle bad actors, and I believe adapting those for prediction markets is the right path, as discussed in questions 1-6 on core principles.
I respectfully ask the CFTC to support well-regulated prediction markets with fair, balanced rules that protect consumers while allowing innovation and participation. Don't let over-restriction push this valuable tool offshore or out of reach for everyday traders like me.
Sincerely,
Johnathon Hampton
