Comment Text:
Dear Chairman and Commissioners,
My name is Chloe MacRae, and I'm a trader and investor based in California. I've been actively trading on prediction markets like Kalshi for a while now, and Im writing to share my 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 unique value, and I urge you to regulate them proportionately rather than impose bans or overly restrictive rules.
As someone who spends a lot of time analyzing markets, Ive found prediction markets to be an incredible tool for gaining insights that I cant get from news or polls. Whether its an election outcome or an economic data release, the prices on these platforms often cut through the noise and give a clearer picture of whats likely to happen. This isnt just useful for me as a trader; its valuable for anyone trying to make sense of an uncertain world. Beyond that, trading on these markets isnt gambling. Its about research, judgment, and understanding real-world events, much like trading stocks or commodities. Labeling event contracts as gaming doesnt make sense when they serve real economic purposes like price discovery and hedging. Ive used them myself to hedge personal financial risks tied to policy changes, and I know others do the same.
Im also worried about what happens if the CFTC over-restricts or bans these markets. If that happens, trading wont just stop. Itll move to unregulated offshore platforms where theres no oversight, no consumer protection, and no accountability. Ive seen how other financial products get pushed underground when rules get too tight, and its always worse for everyone. Keeping prediction markets regulated under the CFTC, like on designated contract markets, ensures transparency and safety. I think thats a far better path.
Looking at some of the specific questions in your ANPR, I want to address Question 8 under Public Interest. You asked about balancing innovation with consumer protection. I believe regulated prediction markets strike that balance by allowing innovation while keeping strong safeguards in place. And on Question 15 under Listed Activities, Id argue that event contracts shouldnt be lumped in with gaming. Theyre a legitimate financial tool, not a game of chance.
I understand there are concerns about things like insider trading or manipulation. But those issues are already illegal, and the CFTC has the tools to enforce against bad actors. Shutting down or over-restricting these markets punishes honest traders like me instead of targeting the real problems. I hope youll focus on targeted rules to address specific risks rather than broad prohibitions.
Thank you for considering my perspective. I strongly support proportionate regulation of prediction markets to keep them accessible, safe, and innovative within the U.S. financial system.
Sincerely,
Chloe MacRae
