Comment Text:
Dear Chairman and Commissioners,
My name is Carter Shannon, and I'm a resident of the District of Columbia. As an everyday citizen who actively trades on prediction markets like Kalshi, I'm writing to express my strong support for proportionate regulation of these markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these platforms provide unique value to people like me, and to society at large, and I want to share why I think the CFTC should regulate them thoughtfully instead of banning or over-restricting them.
I use prediction markets to get a real-time sense of investment trends, legislative outcomes, and consumer behavior. This helps me assess risk in ways that traditional polls or pundit opinions just can't match. I've found that the forecasts on these platforms are often more accurate, especially for elections and public events. That kind of insight isn't just useful for traders like me; it's valuable for everyone, including government agencies who could use this data to predict consumer behavior or track spending habits in real time. What's more, these platforms offer granular, open-source data that levels the playing field. Unlike expensive private data sets that only big players can afford, this information helps retail investors and innovators building new technologies to compete in the market.
I also want to stress that event contracts aren't gambling. They serve real economic purposes, like helping me gauge risks that affect my financial decisions. Trading on these markets takes research and judgment, much like investing in stocks. Labeling it as gaming feels like a misstep when the skills involved are so similar to other regulated investments. I'm also concerned that banning or over-restricting these markets would push activity to offshore platforms, which are far less safe for consumers. I'd much rather see the CFTC regulate these markets here in the US, ensuring consumer protection while keeping the US competitive in financial innovation. We should be leading on this, not ceding ground to other countries.
Looking at some of the specific questions in the ANPR, I think Question 7 on balancing innovation and consumer protection hits the nail on the head. Regulation should focus on protecting users without stifling the benefits prediction markets bring. Also, Question 15 about defining gaming versus legitimate markets is key; these contracts aren't about luck, they're about informed forecasting. And on Question 29 regarding inside information, I believe the CFTC's existing tools to combat manipulation and insider trading can be adapted here without resorting to broad bans.
I urge you to support well-regulated prediction markets that allow everyday people like me to participate. Don't let over-restriction or outright prohibitions push this valuable tool into less safe, offshore spaces. Thank you for considering my perspective.
Sincerely,
Carter Shannon
