Comment Text:
Dear Chairman and Commissioners,
My name is Nick Bratton, and I'm a trader and investor based in Iowa. I've been actively trading on prediction markets like Kalshi for a while now, and Im writing to support proportionate regulation of these markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these platforms offer real value to people like me, and to society as a whole, and I hope the CFTC will regulate them in a way that allows innovation while addressing valid concerns.
As someone who trades to manage financial risks, Ive found prediction markets to be an incredible tool. I use them to hedge against events that directly impact my investments and personal finances, like election outcomes that could shift tax policies or Federal Reserve decisions that affect interest rates. This isn't just playing a game; it's a practical way to protect myself from uncertainty. I know I'm not alone in this. Farmers here in Iowa could hedge against crop policy changes, and small businesses could manage risks from regulatory shifts. These event contracts serve legitimate economic purposes, not gambling, and I urge the CFTC to recognize that distinction when considering how to define "gaming" in Question 15.
I also value the accuracy of prediction markets. I've seen firsthand how their forecasts often beat polls or pundits. Thats not just useful for traders; its information the public, media, and even policymakers can benefit from. Academic research backs this up, showing how these markets aggregate information efficiently. On top of that, platforms like Kalshi, operating as a regulated Designated Contract Market, provide transparency and safety that you won't find on offshore sites. Banning or over-restricting these markets, as raised in Questions 7 and 8 on public interest, would only push activity to unregulated platforms where theres no oversight. Thats a worse outcome for everyone.
Im all for freedom to participate in legal, regulated markets. Letting regular folks like me trade alongside bigger players makes the system fairer and the prices more accurate. The U.S. should be leading the way in financial innovation, not handing that advantage to other countries. Im concerned that heavy-handed rules could stifle this growing space. Regarding Questions 23 and 24 on procedural aspects, I think the CFTC should focus on case-by-case public interest determinations rather than broad categorical bans, ensuring specific risks are addressed without killing the market.
I understand worries about manipulation or insider trading, but the CFTC already has tools to tackle those issues. Use them, rather than punishing the majority who trade honestly. I strongly encourage the Commission to support well-regulated prediction markets that allow innovation, protect consumers, and keep activity onshore under your oversight.
Thank you for considering my input.
Sincerely,
Nick Bratton
