Comment Text:
Dear Chairman and Commissioners,
My name is Samuel Ot, and I'm a trader and investor based in Nevada. I've been actively trading on prediction markets like Kalshi for some time now, and I'm writing to share my perspective on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the development of well-regulated prediction markets in the United States, and I hope my input can help shape a balanced approach to this growing industry.
As someone who participates in these markets, I see firsthand how they provide unique value. Event contracts aren't gambling, in my view. They serve real economic purposes, like helping me make informed decisions with data that I can't find in polls or news commentary. The prices on platforms like Kalshi often reflect a clearer picture of what's likely to happen, whether it's an election outcome or an economic indicator. That information benefits not just traders like me, but anyone who pays attention to these markets. I also believe that allowing regular folks like myself to participate democratizes access to this kind of insight. If only big institutions could trade, the best information would stay locked away with them.
I'm particularly concerned about the risk of over-restriction or outright bans on prediction markets. I've seen unregulated offshore platforms out there, and they're nowhere near as safe or transparent as a CFTC-regulated market like Kalshi. If the U.S. clamps down too hard, traders like me will get pushed toward those less secure options. That doesn't protect anyone. It just cedes ground to other countries. I think the U.S. should be leading the way in financial innovation, not handing that advantage to others. We have the chance to set the global standard for how these markets should work.
I also want to address concerns about manipulation or insider trading, which I know are on the CFTC's mind with questions like 29 to 32 in the ANPR. I get why this is a worry, but the CFTC already has strong tools to tackle fraud and manipulation in other derivatives markets. Those can be applied here without reinventing the wheel. Plus, informed trading often improves price discovery, which helps everyone. Banning or overly restricting these markets to stop a few bad actors punishes the majority of us who play by the rules. It's like closing a highway because some people speed.
I'm asking you to support proportionate regulation that keeps prediction markets accessible on regulated platforms. Address specific risks with targeted rules, as mentioned in questions 1 to 6 on core principles, rather than broad prohibitions. Let's keep the U.S. competitive and ensure traders like me can participate in safe, legal markets without being driven offshore.
Thank you for considering my views.
Sincerely,
Samuel Ot
