Comment Text:
Dear Chairman and Commissioners,
My name is Ansh Patel, and I'm a trader and investor based in Texas. I'm writing to express my strong support for the proportionate regulation of prediction markets, as discussed in the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I've been actively trading on platforms like Kalshi for a while now, and I believe these markets provide real value to individuals like me, as well as to businesses and the broader economy.
As a trader, I rely on prediction markets to hedge against risks that affect my personal finances and investments. For instance, I've used these markets to manage uncertainty around election outcomes that could impact tax policies or regulatory changes affecting my portfolio. This isn't gambling, it's a practical tool for managing real-world risks, much like trading futures or options to hedge against commodity price swings. I know small businesses in Texas that could benefit from similar hedging opportunities, like protecting against policy shifts that impact their operations. Banning or overly restricting these markets would strip away a valuable resource for people like me who are just trying to navigate economic uncertainty.
I'm also concerned about U.S. competitiveness in financial innovation. Prediction markets are a cutting-edge tool, and the U.S. should be leading the way, not falling behind. If we over-regulate or shut these markets down, the activity will just move to offshore platforms with no oversight. I've seen unregulated markets out there, and they're far riskier for participants. Keeping prediction markets legal and regulated under the CFTC ensures transparency and safety, which benefits everyone.
I want to address a concern I know the CFTC has about manipulation or insider trading, especially in questions 29 to 32 of the ANPR. I get why this is a worry, but the CFTC already has strong tools to tackle these issues in other derivatives markets. Those same tools can be applied here. Punishing all traders by banning or restricting prediction markets because of a few bad actors doesn't seem fair. It's like closing the stock market over insider trading scandals. Enforce the rules you have, don't take away our freedom to participate in a legal, regulated space.
In response to questions 7 to 14 on public interest, I believe prediction markets serve a clear public good by providing unique information and democratizing access to risk management tools. They help regular folks like me, not just big institutions, prepare for whats coming.
I urge the CFTC to support well-regulated prediction markets with targeted rules that address specific risks without broad bans or over-restrictions. Let's keep the U.S. at the forefront of financial innovation and protect the right of individuals and businesses to use these markets responsibly.
Thank you for considering my input.
Sincerely,
Ansh Patel
