Comment Text:
Dear Chairman and Commissioners,
My name is Bismarck Perez, and I'm a trader and investor based in New Jersey. I've been actively trading on prediction markets like Kalshi for a while now, and I'm writing to express my strong support for well-regulated prediction markets in response to your Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these markets provide real value to people like me and to society as a whole, and I urge you to adopt proportionate rules rather than overly restrictive bans.
As someone who trades regularly, I can tell you that event contracts are not gambling. They serve legitimate economic purposes, like helping me hedge risks tied to political or economic events that impact my investments. Whether it's an election outcome affecting tax policy or a Fed decision influencing interest rates, these markets let me make informed decisions based on research and judgment, just like I do with stocks or commodities. Classifying them as "gaming," as discussed in Questions 15-22 of your ANPR, ignores their real utility for price discovery and risk management. The data from these markets often predicts outcomes better than polls or pundits, and that benefits everyone, not just traders.
I also value the freedom to participate in legal, regulated markets like Kalshi. Platforms under CFTC oversight are far safer than unregulated offshore alternatives. If you ban or over-restrict prediction markets, you're not stopping the activity; you're just pushing it to less transparent, riskier venues where consumers have no protection. Honestly, I've seen sportsbooks that feel far more predatory than Kalshi ever could. Regulated markets keep things fair and accountable, and they help the US stay competitive in financial innovation, a point raised in Questions 7-14 about public interest. We shouldn't cede leadership in this space to other countries.
On the topic of insider trading and informed trading, as covered in Questions 29-32, I believe informed trading actually improves price discovery. It makes the market's predictions more accurate, which helps everyone. Bad actors and manipulation are already illegal under existing CFTC rules, so the answer isn't to ban these markets but to enforce the tools you already have. Broad categorical bans punish honest participants like me while doing little to stop the real problems.
I strongly encourage the CFTC to focus on targeted, proportionate regulation that addresses specific risks without stifling the benefits of prediction markets. Please don't let overregulation or outright prohibitions drive this valuable activity offshore or underground. I'm counting on you to strike the right balance.
Thank you for considering my perspective.
Sincerely,
Bismarck Perez
