Comment Text:
Dear Chairman and Commissioners,
My name is Andy Selfors, and I'm a finance professional based in New York. I've been actively trading on prediction markets like Kalshi 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 believe they are valuable, both for me personally and for society at large.
As someone who works in finance, I rely on accurate information to make decisions every day. Prediction markets have consistently provided forecasts on elections and public events that are more reliable than polls or pundit opinions. I've used these insights not just for trading, but to better understand the likelihood of outcomes that affect my financial planning. Beyond that, Ive been able to hedge real risks through these markets, like potential policy changes or economic shifts that could impact my investments or business decisions. This isnt gambling; its a legitimate tool for managing uncertainty, much like trading futures or options.
I also value the freedom to participate in legal, regulated markets like Kalshi. These platforms are transparent and safe, unlike unregulated offshore alternatives where theres little to no consumer protection. If the CFTC over-restricts or bans prediction markets, I worry that activity will just move to those less safe venues. Regulation is the answer, not prohibition. I believe the CFTC already has strong tools to prevent manipulation and insider trading in other derivatives markets, and those can be applied here without broad bans. Plus, informed trading actually improves price discovery, benefiting everyone, not just traders.
On a broader level, I think prediction markets contribute to better public decision-making by aggregating information efficiently. Academic research backs this up, showing how these markets often outperform traditional forecasting methods. The U.S. should be leading in financial innovation, not ceding ground to other countries. Classifying event contracts as gaming misses the point; they serve real economic purposes like hedging and price discovery. Id urge you to consider specific questions in the ANPR, like Question 7 on balancing innovation with consumer protection, and Question 15 on defining gaming versus legitimate markets. My view is clear: proportionate regulation addresses risks without stifling benefits.
Im not blind to concerns about manipulation or insider trading, but punishing all participants for the actions of a few bad actors doesnt make sense. Lets focus on targeted rules and enforcement, not broad restrictions. I respectfully ask the CFTC to support the growth of regulated prediction markets in a way that protects consumers while preserving access and innovation.
Thank you for considering my input.
Sincerely,
Andy Selfors
