Comment Text:
Dear Chairman and Commissioners,
My name is Connor Aoun, and I'm a trader and investor from Kansas. I've been actively trading on prediction markets like Kalshi for a while now, and I wanted to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I strongly support the development of well-regulated prediction markets in the United States, and I hope the CFTC will craft rules that encourage innovation while protecting consumers.
As someone who trades regularly, I can tell you firsthand that prediction markets provide information you just can't get elsewhere. I've seen their forecasts on elections and other public events consistently outperform polls and pundits. This isn't just useful for traders like me; it helps everyone, from regular citizens to policymakers, make better decisions with better data. I also use these markets to hedge personal financial risks, like potential policy changes that could impact my investments or taxes. It's a real tool for managing uncertainty, not some game.
I'm also concerned about what happens if these markets get over-restricted or banned. I've looked at offshore platforms before, and they're nowhere near as safe or transparent as a regulated market like Kalshi. If the CFTC clamps down too hard, you're not stopping the activity; you're just pushing people like me to riskier, unregulated spaces. That's not consumer protection. I think the CFTC already has strong tools to handle issues like manipulation and insider trading in other derivatives markets. Why not adapt those instead of broad bans? I'd point to Questions 1 and 29 in your ANPR, on manipulation prevention and insider information. Informed trading actually improves price discovery, and that benefits everyone in the market, not just a few.
Another thing that bugs me is the idea of classifying event contracts as gaming. I spend hours researching before I place a trade, just like I do for stocks or commodities. This isn't gambling; it's a legitimate economic activity with real purposes, like hedging and price discovery. I urge you to consider Question 15 on defining gaming versus legitimate markets and lean toward recognizing the value these contracts bring.
Finally, I believe the US should be a leader in financial innovation. We shouldn't let other countries take the lead because we're too afraid to regulate smartly. Proportionate, targeted rules make more sense than categorical restrictions. Let's address specific risks without throwing out the whole concept. I'm thinking of Questions 7 and 23 here, on balancing innovation with public interest and how to structure those determinations.
I appreciate the chance to comment and hope the CFTC will support regulated prediction markets with fair, balanced rules that keep them accessible to everyday traders like me.
Sincerely,
Connor Aoun
