Comment Text:
Dear Chairman and Commissioners,
My name is Gerardo Santillan, and I'm a teacher from Oklahoma. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I strongly support the idea of well-regulated prediction markets, and I want to explain why they matter to me and why I believe the CFTC should regulate them proportionately rather than restrict or ban them.
As a teacher, I value accurate information, especially when it comes to elections and public events that affect my community and my students. I've found prediction markets, like Kalshi where I actively trade, to be an incredible tool for forecasting. They're often more accurate than polls or pundits, and that kind of insight helps me make sense of the world, whether I'm discussing current events in class or just talking with friends. Beyond that, trading on these markets has become a bonding activity for my family and friends. We enjoy making predictions together, debating the odds, and learning from each other. It's brought us closer in a unique way.
I also see real economic value in these markets. They're not gambling, no matter what some might say. Trading on Kalshi takes research and judgment, just like investing in stocks. Plus, they let people like me hedge against risks. For example, I've used election outcome contracts to offset uncertainties that could impact my family's finances. This isn't a game; it's a practical tool. And frankly, having access to these markets as an everyday person feels fair. If only big institutions could participate, all the valuable information would stay with them. Democratized access makes the prices more accurate and benefits everyone.
I'm not blind to concerns about manipulation or insider trading, but I believe the CFTC already has the tools to handle those issues. Those actions are illegal, and the Commission has the power to enforce the law. Banning or over-restricting prediction markets doesn't solve the problem; it just pushes activity to unregulated offshore platforms where there's no oversight at all. I'd much rather see safe, regulated markets like Kalshi thrive here in the U.S. That protects consumers like me. On this point, I think Question 7 from your ANPR, about balancing innovation and consumer protection, is key. Regulation should encourage innovation while addressing specific risks, not wipe out an entire market.
I also want to touch on Questions 15 and 16, about defining gaming versus legitimate markets. Event contracts serve real purposes, like hedging and price discovery. Classifying them as gaming ignores their economic role. And as Question 29 asks, informed trading actually improves price discovery. It helps everyone, not just traders.
The U.S. should be a leader in financial innovation, not cede ground to other countries. Academic research backs this up, showing how prediction markets aggregate information efficiently. So, my ask is simple. Please support proportionate regulation that targets specific risks without broad bans. Keep markets like Kalshi accessible and safe for people like me.
Thank you for considering my perspective.
Sincerely,
Gerardo Santillan
