Comment Text:
Dear Chairman and Commissioners,
My name is Sambhab Sau, and I'm a software engineer based in Connecticut. Im writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. As someone who actively trades on platforms like Kalshi, I strongly support the development of well-regulated prediction markets. I believe they provide unique value to society and to individuals like me who want better information to understand the world.
Ive been trading on prediction markets for a while now, mostly focusing on elections and major public events. What strikes me every time is how these markets often predict outcomes more accurately than polls or pundits. I remember last election cycle, the market prices on Kalshi gave a clearer picture of the likely winner weeks before the final polls caught up. That kind of forecasting power isnt just helpful for traders; its valuable for anyone trying to make sense of uncertain events, whether its a journalist, a policymaker, or just a curious citizen. This isnt gambling, in my view. Its about aggregating real-world information through price discovery, much like how stock markets reflect a companys value. Event contracts serve a genuine economic purpose, and labeling them as gaming misses the point.
As a tech professional, I also think the US needs to be at the forefront of financial innovation. If we over-regulate or ban these markets, were just pushing activity to offshore platforms with no oversight, or handing the lead to other countries. Thats not the way to go. Instead, I believe the CFTC should focus on proportionate, targeted rules that address specific risks like manipulation or insider trading, without broad categorical bans. On the point of insider information, Id argue that informed trading actually improves price discovery. It makes the markets predictions sharper, which benefits everyone, not just traders. The CFTCs existing tools to combat illegal insider activity can be adapted here, as asked in Questions 29 and 30 of the ANPR.
I understand there are concerns about manipulation or misuse, and those shouldnt be ignored. But the answer isnt to shut down an entire market. Its about using the authority the CFTC already has to go after bad actors, while letting legitimate participants contribute to better information for all. Im particularly interested in your thoughts on balancing innovation with consumer protection, as raised in Questions 7 and 8. I think we can have both if the rules are smart and focused.
In short, I urge the CFTC to support the growth of prediction markets with clear, fair regulations. Dont let overly restrictive policies stifle a tool thats already proving its worth for forecasting and decision-making. Thank you for considering my perspective.
Sincerely,
Sambhab Sau
