Comment Text:
Dear Chairman and Commissioners,
My name is Ian Garza, and I'm a trader and investor based in Texas. I've been actively trading on prediction markets like Kalshi and Polymarket for a while now, and Im writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the development of well-regulated prediction markets in the United States, and I want to share why I think theyre valuable, both for me personally and for society at large.
As a trader, Ive seen firsthand how prediction markets provide information thats just not available anywhere else. Whether its forecasting election outcomes or major public events, these markets consistently outperform polls and pundits. That accuracy helps me make better financial decisions, and its not just useful for traders like me. Better information benefits everyone, from policymakers to regular folks trying to understand whats coming next. I also use these markets to hedge real risks. For example, Ive traded contracts tied to economic indicators that could impact my investments or personal finances. Its a practical tool, not a game.
Im concerned about the idea of classifying event contracts as gaming, as raised in Questions 15-22 of the ANPR. These contracts serve legitimate economic purposes like hedging and price discovery, much like trading stocks or commodities. Calling them gambling feels like a misstep when the skills involved are research and judgment about real-world events. On top of that, I believe informed trading, as discussed in Questions 29-32, actually improves price discovery. It makes markets more accurate, which helps everyone, not just the traders.
I also want to address the risks head-on. Yes, manipulation and insider trading are concerns, but the CFTC already has strong tools to tackle these issues in other derivatives markets. Theres no need for broad bans or over-restrictions when targeted rules can address specific problems. Id much rather see proportionate regulation, as mentioned in Questions 33-40, than categorical prohibitions that punish legitimate participants. And lets be honest, banning or heavily restricting these markets will just push activity to unregulated offshore platforms. Ive traded on Kalshi, a CFTC-registered market, and the transparency and oversight there make me feel far safer than dealing with offshore alternatives.
Finally, I think the U.S. has a chance to lead in financial innovation. We shouldnt cede this space to other countries. Regulated prediction markets can be a win for consumer protection and competitiveness, as long as the rules are fair and focused. I urge you to support proportionate regulation that allows these markets to thrive while addressing real risks with the tools you already have.
Thank you for considering my input.
Sincerely,
Ian Garza
