Comment Text:
Dear Chairman and Commissioners,
My name is James Wilson, and I'm a student from Mississippi with a strong interest in economics and financial markets. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I actively trade on platforms like Kalshi, and I believe that well-regulated prediction markets offer real value to individuals like me, as well as to society at large. I urge the CFTC to support proportionate regulation rather than imposing overly restrictive rules or outright bans.
As a student, I've seen firsthand how prediction markets provide information that you just can't find elsewhere. Their forecasts on elections and public events often beat polls and pundits by a wide margin. I rely on this data for my studies and to better understand the world around me. It's not just academic, though. These markets let regular people like me hedge personal risks. For instance, I've used them to offset potential financial impacts from policy changes or economic events that could affect my future job prospects or student loans. This isn't gambling. It takes research and real-world judgment, much like trading stocks.
I also worry about what happens if these markets get over-regulated or banned. Platforms like Kalshi, which operate under CFTC oversight, are safe and transparent. If restrictions push activity to unregulated offshore sites, consumers lose protection. I've read enough to know that the CFTC already has strong tools to tackle manipulation and insider trading in other markets. Those same tools can work here without resorting to broad bans that punish everyone for the actions of a few. Plus, informed trading actually helps. It makes prices more accurate, which benefits all of us.
I want to touch on a couple of specific questions from the ANPR. On Question 7, regarding public interest, I believe prediction markets serve a clear public good through better price discovery and risk management. On Question 15, about defining gaming, I strongly feel event contracts aren't gambling. They have legitimate economic purposes like hedging and forecasting. And on Question 29, about inside information, I think informed traders improve market accuracy, as long as existing laws against insider trading are enforced.
The US has a chance to lead in financial innovation. We shouldn't cede that to other countries by over-restricting these markets. I'm not blind to the risks, but targeted rules can address specific issues like manipulation without throwing out the whole concept. I hope the CFTC will craft regulations that protect consumers while allowing prediction markets to thrive. They're a tool for better information, personal freedom, and economic utility. Please don't shut them down with heavy-handed policies.
Thank you for considering my perspective.
Sincerely,
James Wilson
