Comment Text:
Dear Chairman and Commissioners,
My name is Vlad Shtrikman, and I'm a finance professional from California. I've been actively trading on regulated prediction markets like Kalshi for a while now, and Im writing to support the proportionate regulation of these markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these platforms offer unique value to individuals like me, to businesses, and to society as a whole, and I urge the CFTC to craft rules that foster innovation while addressing real risks.
As someone in finance, I see prediction markets as a powerful tool for price discovery and better decision-making. The data they generate often outpaces traditional polls or expert opinions in accuracy, and that benefits not just traders but anyone looking for reliable insights, from policymakers to the general public. I've used platforms like Kalshi to hedge personal financial risks tied to economic events, such as interest rate decisions that impact my investments or inflation prints that affect my cost of living. This isn't gambling; its a legitimate way to manage uncertainty, much like trading futures or options.
I also worry about what happens if the CFTC over-restricts or bans these markets. Ive seen unregulated offshore platforms out there, and theyre far riskier, with no oversight or consumer protections. Regulated markets like Kalshi, under CFTC supervision, are the safer choice. Banning or overly limiting event contracts would just push activity to those shadowy venues, which helps no one. On this point, Id like to address Question 7 from the ANPR on balancing innovation and consumer protection. I believe the answer lies in strong regulation of domestic markets, not in driving participants offshore.
Another concern I have is the classification of event contracts as gaming. I strongly disagree with that label. These contracts serve real economic purposes, like hedging and information aggregation, as Ive experienced firsthand. Regarding Question 15 on defining gaming versus legitimate markets, I think the focus should be on the economic utility of the contract, not a blanket assumption that its a game. Additionally, on Questions 29 and 30 about inside information, I believe informed trading actually improves price discovery for everyone. The CFTC already has robust tools to combat manipulation and insider trading in other derivatives markets; those same tools can work here without broad categorical bans.
Finally, I want to stress the importance of U.S. leadership in financial innovation. If we stifle prediction markets, other countries will take the lead, and well lose out on the economic and intellectual benefits. Academic research, which I follow closely, consistently shows these markets improve transparency and forecasting. Lets not throw that away. Im all for consumer protection, but it should be targeted and proportionate, not a sledgehammer approach.
I respectfully ask the CFTC to support well-regulated prediction markets that allow individuals and businesses to participate legally and safely. Dont let over-restriction push this valuable tool into the shadows.
Sincerely,
Vlad Shtrikman
