Comment Text:
Dear Chairman and Commissioners,
My name is Gerardo Arellano, and I'm just an everyday citizen from Georgia. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've been actively trading on platforms like Kalshi for a while now, and I strongly support the idea of well-regulated prediction markets. I believe they offer real value to people like me, and I hope the CFTC will craft rules that let them thrive without over-restricting access.
I rely on prediction markets for insights I can't get from polls or pundits. I've seen firsthand how their forecasts are often more accurate, whether it's about elections or economic indicators. That kind of information isn't just useful for traders; it helps everyone make better decisions. I also use these markets to hedge personal risks. For example, Ive placed trades on interest rate decisions because they impact my plans for a home loan. This isn't gambling to me. It takes research and judgment, just like investing in stocks. Labeling event contracts as "gaming" ignores their real economic purpose, and I urge the CFTC to recognize that distinction, especially in response to questions 15-22 about listed activities.
I'm also worried that banning or over-restricting these markets would push activity to unregulated offshore platforms. I've looked at some of those sites, and they feel far less safe than a regulated market like Kalshi. Keeping prediction markets under CFTC oversight, with the robust tools you already have to prevent manipulation and insider trading, seems like the better path. You don't need broad categorical bans; targeted rules can address specific risks. I think this ties directly to questions 7-14 on balancing innovation and consumer protection. Plus, informed trading actually helps price discovery, making markets more accurate for everyone, as discussed in questions 29-32 on inside information.
Finally, I believe the U.S. should lead in financial innovation. If we clamp down too hard, other countries will take the lead, and we'll lose out. Academic research backs this up too; studies show prediction markets aggregate data efficiently. We should build on that, not stifle it. So, I'm asking the CFTC to support proportionate regulation that keeps these markets accessible to regular folks like me, while addressing legitimate concerns with the tools already in place.
Thank you for considering my perspective.
Sincerely,
Gerardo Arellano
