Comment Text:
Dear Chairman and Commissioners,
My name is Ian Lyons, and I'm a policy professional based in New York. Im writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. Ive been actively trading on platforms like Kalshi for a while now, and I strongly support the development of well-regulated prediction markets. They provide unique value to me personally, to my family, and to society at large, especially in terms of gauging public opinion and managing financial risks.
As someone who works in policy, I see firsthand how prediction markets offer insights that polls and pundits often miss. The aggregated data from these platforms is a powerful tool for understanding public sentiment on elections and other major events. Beyond that, theyre a practical financial instrument for my family. Ive used them to hedge against uncertainties like policy changes that could impact our taxes or small business interests. This isnt gambling, its a calculated way to manage real risks, much like trading stocks or commodities. Classifying event contracts as gaming, as discussed in Questions 15-22, ignores their legitimate economic purpose and the skills involved in trading them.
I also believe the U.S. must lead in financial innovation. If we over-restrict or ban these markets, as some might push for, were just handing the advantage to other countries. Worse, it drives activity to unregulated offshore platforms, which lack the consumer protections that CFTC oversight provides. Ive traded on Kalshi because its regulated and transparent. Push this market underground, and you expose participants to far greater risks. This ties directly to Questions 7-14 on balancing innovation and consumer protection. Regulation, not prohibition, is the answer.
On the topic of insider trading and manipulation raised in Questions 29-32, Ill say this: informed trading often improves price discovery, which benefits everyone. Bad actors are already covered by existing laws and CFTC powers. We dont need broad bans, we need targeted enforcement. Sufficient oversight already exists, and further restrictions will only hurt legitimate users while pushing the market offshore. Proportionate regulation, not categorical prohibitions, should be the goal.
Prediction markets arent just a niche interest for me. They democratize access to information and give regular people like me a stake in understanding the world. The academic research backing their forecasting value, as well as their role in price discovery, is clear. I urge the CFTC to support these markets with balanced rules that address specific risks without stifling their potential.
Thank you for considering my input. I ask that you pursue proportionate regulation of prediction markets and avoid over-restrictive measures or outright bans.
Sincerely,
Ian Lyons
