Comment Text:
Dear Chairman and Commissioners,
My name is Victor Salas, and I'm a trader and investor based in Oklahoma. I've used prediction markets a few times to test the waters, and Im writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the idea of well-regulated prediction markets, and I want to share my perspective on why they matter to folks like me and how the CFTC can approach this without overreaching.
As someone who trades and invests, I value the freedom to participate in legal, regulated markets. Prediction markets offer unique information you cant find elsewhere, often more accurate than polls or talking heads on TV. They let regular people like me have a stake in understanding real-world events, whether its an election or an economic decision that could affect my portfolio. Ive seen firsthand how these platforms can sharpen my thinking about risks and outcomes. This isnt gambling. It takes research and judgment, just like any other investment I make.
One big reason I support regulation over outright bans is safety. Regulated markets, like Kalshi, which operates under CFTC oversight, are far safer than unregulated offshore platforms. If you restrict these markets too much, youll just push people like me to less secure, shadier options outside the US. Thats not protecting anyone. Its the opposite. I want the US to lead in financial innovation, not fall behind while other countries build better systems. Keeping these markets regulated here ensures accountability and transparency, which benefits everyone.
I do have concerns about insider trading, though. Ive noticed it running rampant on some platforms, and its frustrating to see bad actors game the system. But banning prediction markets isnt the answer. The CFTC already has tools to crack down on manipulation and insider trading in other markets, and those should be applied here too. Punishing the majority for the actions of a few doesnt make sense. On that note, Id suggest the CFTC consider background checks for participants to flag politicians or their close relatives who might have access to nonpublic info. That could be a practical step to address insider risks without shutting everything down. Im curious about your thoughts on this, especially in relation to Questions 29-32 on inside information.
I also want to touch on Question 7 from the ANPR about balancing innovation and consumer protection. I think proportionate regulation is the way to go. Set clear rules, enforce them, but dont smother a useful tool that gives people access to better information and a chance to hedge real risks.
In closing, I urge the CFTC to support well-regulated prediction markets with targeted rules that address specific problems like insider trading, rather than broad restrictions that hurt regular traders like me. Lets keep the US competitive and keep these markets safe and accessible.
Sincerely,
Victor Salas
