Comment Text:
Dear Chairman and Commissioners,
My name is Allie Kay, and I'm a student from New York with a strong interest in economics and public policy. I've been actively trading on prediction markets like Kalshi for the past year, and I'm writing to express my support for well-regulated prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these markets provide unique value to society, and I urge the CFTC to adopt proportionate regulations rather than overly restrictive bans.
As a student, I've seen firsthand how prediction markets offer better information for decision-making than traditional polls or pundit opinions. Whether it's forecasting election outcomes or public events, the prices on these platforms consistently cut through the noise and provide a clearer picture of what might happen. This isn't just useful for traders like me; it helps everyone, from policymakers to regular citizens, make sense of an uncertain world. I also value the freedom to participate in legal, regulated markets. Banning or over-restricting them would push activity to offshore platforms, which are far less safe and transparent.
Im particularly passionate about the academic side of this. Prediction markets generate transparent data that researchers like me can study to understand crowd wisdom and market behavior. They aren't gambling, no matter what some critics say. Trading on these platforms requires research and judgment, much like investing in stocks. Plus, they serve real economic purposes, like helping individuals and businesses hedge risks. For example, I've used Kalshi to hedge personal financial concerns tied to inflation data releases, which directly affect my budget as a student.
Addressing some of the CFTC's specific questions, like those in Topic B on public interest (Questions 7-14), I believe prediction markets enhance price discovery and risk management while fostering innovation. The US should be a leader in financial technology, not cede ground to other countries. On Topic E regarding inside information (Questions 29-32), I think informed trading actually improves price accuracy and benefits all participants, as long as manipulation is prevented. And speaking of that, the CFTC already has strong tools to combat insider trading and market manipulation. There's no need for broad categorical bans when targeted enforcement can address bad actors without punishing everyone else.
I understand concerns about potential abuse, but shutting down or overly restricting these markets isn't the answer. Proportionate regulation that tackles specific risks is far better. I've benefited from the insights and hedging opportunities prediction markets provide, and I know many others have too. Please ensure that students, researchers, and everyday people can continue to access these valuable tools.
Thank you for considering my perspective. I strongly support the CFTC crafting balanced regulations for prediction markets that protect consumers while preserving innovation and access.
Sincerely,
Allie Kay
