Comment Text:
Dear Chairman and Commissioners,
My name is Michael Lee, and I'm just a regular citizen from Washington state 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 prediction markets are a valuable tool that should be regulated fairly, not banned or overly restricted.
I started using prediction markets a couple of years ago to hedge personal financial risks. For example, I run a small side business selling handmade goods online, and election outcomes can directly impact policies on taxes or shipping costs that hit my bottom line. Being able to trade event contracts on platforms like Kalshi helps me offset some of that uncertainty. It's not gambling, it's a practical way to manage real-world risks. I put time into researching candidates and policies, just like I would for any investment. Classifying these contracts as "gaming" feels wrong when they serve a clear economic purpose for people like me.
Beyond my own needs, I see how prediction markets provide better forecasts than polls or pundits, especially for elections and big public events. I've noticed their predictions often cut through the noise and give a clearer picture of what's likely to happen. That kind of information is useful to everyone, not just traders. I'm also concerned that over-restricting or banning these markets will push activity to unregulated offshore platforms. I've seen those sites out there, and they don't have the safeguards of a CFTC-registered market like Kalshi. Regulation keeps us safer, but only if its reasonable.
On specific points from your ANPR, I want to address questions in Topic B about public interest and innovation. I think the U.S. should be leading the way on financial tools like prediction markets, not falling behind other countries. And regarding questions in Topic C on classification as gaming, I strongly feel event contracts aren't gambling. They're about research and judgment, not luck. As for concerns about manipulation or insider trading raised in Topic E, I believe the CFTC already has strong tools to tackle those issues. You don't need broad bans, just targeted enforcement of existing rules.
I know there are risks to consider, and consumer protection matters to me. But shutting down or over-restricting prediction markets punishes regular people like me who use them responsibly. Proportionate regulation that addresses specific problems makes more sense than categorical prohibitions. I urge you to support well-regulated prediction markets that allow everyday citizens to participate in legal, safe platforms.
Thank you for considering my perspective.
Sincerely,
Michael Lee
