Comment Text:
Dear Chairman and Commissioners,
My name is Jacob Patrick Reed, and I'm a software engineer based in Nevada. Im writing to express my strong support for well-regulated prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). As someone who actively trades on platforms like Kalshi, Ive seen firsthand the value these markets provide, and I believe the CFTC has a chance to craft rules that encourage innovation while addressing real risks.
I got into prediction markets because I wanted a way to hedge personal financial risks tied to economic events, like interest rate decisions that affect my loans or tech policy outcomes that could impact my career. Trading on Kalshi isn't just a hobby; its a practical tool. Beyond my own use, Im struck by how these markets consistently produce forecasts more accurate than polls or pundits. As a tech professional, I value data transparency, and the academic research backing prediction markets, showing they aggregate information efficiently, really resonates with me. This isn't gambling. It takes research and judgment, just like any other investment, and event contracts serve legitimate economic purposes like hedging and price discovery.
Im concerned, though, about the risk of over-restriction. If the CFTC bans or heavily limits these markets, itll just push activity to unregulated offshore platforms, which are far less safe. Id much rather trade on a regulated U.S. market like Kalshi, where theres oversight. The CFTC already has solid tools to tackle manipulation and insider trading in other derivatives markets. I believe those can be adapted here without resorting to broad categorical bans. Informed trading, even if its by people with unique insights, actually improves price discovery and benefits everyone. Why punish all participants for the actions of a few bad actors?
Id like to address a couple of specific questions from the ANPR. On Question 8 under Public Interest, I think prediction markets clearly serve the public by providing unique information and democratizing access to financial tools. On Question 15 under Listed Activities, I urge the CFTC not to classify event contracts as gaming. Theyre not slot machines; theyre economic instruments. And on Question 29 under Inside Information, I believe informed traders help, not hurt, the accuracy of these markets as long as manipulation is policed with existing laws.
The U.S. should be leading in financial innovation, not ceding ground to other countries. I ask the CFTC to pursue proportionate, targeted regulation that addresses specific risks without stifling the benefits of prediction markets. Lets keep these markets accessible, safe, and regulated here at home.
Thank you for considering my input.
Sincerely,
Jacob Patrick Reed
