Comment Text:
Dear Chairman and Commissioners,
My name is Cole Slay, and I'm a business owner from Nevada writing to express my strong support for the proportionate regulation of prediction markets under the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I actively trade on platforms like Kalshi, and I've seen firsthand how these markets provide unique value, both for my business decisions and for society at large.
Running a business in Nevada means I'm constantly dealing with uncertainty, whether it's about federal regulations, election outcomes, or economic shifts that could impact my costs and planning. Prediction markets give me a way to hedge some of that risk. For instance, I've used Kalshi to trade on election outcomes that could affect tax policies directly tied to my bottom line. This isn't just speculation; it's a practical tool to manage real financial exposure. Beyond my own needs, I see how these markets produce forecasts on public events that are often more accurate than polls or pundits. That kind of information helps everyone make better decisions, from business owners like me to policymakers.
I want to address a few specific concerns raised in your ANPR. On the question of whether event contracts should be seen as gaming (Question 15), I strongly believe they shouldn't. Trading on these markets requires research and judgment about real-world events, much like trading stocks or commodities. It's not a game of chance; it's a legitimate economic activity with real purposes like hedging and price discovery. As for insider trading or manipulation worries (Questions 29-32), I get the concern, but the CFTC already has solid tools to tackle fraud and abuse in other derivatives markets. Those same tools can work here. Plus, informed trading often improves price accuracy, which benefits all participants, not just a few.
I also want to stress that regulated markets like Kalshi are far safer than unregulated offshore platforms (Question 7 on public interest). If the CFTC over-restricts or bans these contracts, people will just turn to less transparent venues, and that helps no one. The U.S. should be leading in financial innovation, not pushing activity overseas. I'm all for oversight to prevent bad actors, but punishing everyone with broad bans isn't the answer.
In closing, I urge the CFTC to support well-regulated prediction markets with targeted rules that address specific risks without stifling access or innovation. These markets help people like me manage real risks, provide valuable public information, and keep the U.S. competitive. Please don't let overregulation shut them down.
Sincerely,
Cole Slay
