Comment Text:
Dear Chairman and Commissioners,
My name is Wes Cle, and I'm a trader and investor based in Illinois. I've been actively trading on prediction markets like Kalshi for a while now, and Im writing to express my strong support for well-regulated prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these markets provide unique value to individuals like me, as well as to society at large, and I urge the CFTC to adopt proportionate regulations rather than restrictive bans.
As a trader, Ive seen firsthand how prediction markets produce forecasts that are often more accurate than polls or pundits. Whether its an election outcome or a major public event, the prices on platforms like Kalshi reflect real-time, crowd-sourced information that I cant get anywhere else. This isnt just helpful for my trades; its valuable for anyone making decisions, from policymakers to everyday citizens. I also use these markets to hedge personal financial risks. For example, trading on election outcomes helps me offset potential impacts on my investments tied to policy changes. This isnt gambling. Its a legitimate tool for managing uncertainty, much like trading futures or options.
Im also concerned about the alternative if the CFTC over-restricts these markets. Regulated platforms like Kalshi provide transparency and consumer protections that unregulated offshore markets simply dont have. If access is limited here, activity will just move to less safe venues, putting traders like me at greater risk. The U.S. should be leading in financial innovation, not ceding ground to other countries. Banning or overly restricting prediction markets would do just that.
Addressing some of your specific questions, like those in Topic Area B (Questions 7-14) on public interest and price discovery, I believe informed trading enhances market accuracy and benefits everyone. And on Topic Area C (Questions 15-22) regarding classification as gaming, I strongly feel event contracts serve real economic purposes like hedging and information aggregation. Theyre not gambling; they require research and judgment, just like any other investment. As for concerns about manipulation or insider trading raised in Topic Area E (Questions 29-32), the CFTC already has robust tools to address these issues in other derivatives markets. Use those tools with targeted rules, not broad bans that punish law-abiding participants.
I appreciate the CFTCs focus on consumer protection, and Im not blind to the risks of bad actors. But shutting down or over-regulating prediction markets isnt the answer. Proportionate regulation that tackles specific issues like manipulation, while allowing legal, transparent markets to operate, is the right path forward. Please support innovation and access for traders like me by crafting rules that protect consumers without stifling these valuable markets.
Thank you for considering my input.
Sincerely,
Wes Cle
