Comment Text:
Dear Chairman and Commissioners,
My name is Benjamin Rothfuss, and I'm a trader and investor based in California. I've been actively trading on prediction markets like Kalshi for some time now, and Im writing to express my strong support for proportionate regulation of these markets in response to your Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe well-regulated prediction markets offer immense value to individuals like me, businesses, and society as a whole, and Id like to share my perspective.
Prediction markets aren't just a niche hobby for me; theyre a practical tool. I use platforms like Kalshi to hedge personal and business risks tied to events like elections or economic data releases. For instance, Ive traded contracts on election outcomes to offset potential tax policy changes that could impact my investments. This isn't gambling. Its a calculated way to manage uncertainty, much like trading futures or options in traditional markets. Beyond hedging, I rely on the forecasting power of these markets. The prices often reflect a clearer picture of whats likely to happen than polls or pundits, and that helps me make better decisions, both financially and personally.
I also want to highlight how impressed I am with Kalshi as a platform. Its a game-changer, especially for sports-related contracts. The exchange model provides transparency and fair pricing that Ive never seen in traditional betting markets. The clear data and user-friendly design make it a refreshing tool to use, and I hope the CFTC recognizes the value of supporting such innovation.
On the regulatory side, I strongly believe that regulated markets like Kalshi are far safer than the unregulated offshore alternatives. If the CFTC imposes overly restrictive rules or bans certain contracts, people like me wont just stop trading; well be pushed to less secure platforms with no oversight. Thats a worse outcome for consumer protection. I also think the U.S. should lead in financial innovation. We cant afford to cede this space to other countries by over-regulating at home.
Id like to address a few of your specific questions from the ANPR. Regarding Questions 7-14 on public interest, I believe prediction markets balance innovation with consumer needs by providing unique information for price discovery and decision-making. On Questions 29-32 about inside information, I acknowledge the risk, but the answer isnt to ban these markets. Insider trading and manipulation are already illegal, and the CFTC has tools to enforce those laws. Shutting down prediction markets to stop a few bad actors would punish everyone else who uses them responsibly.
I urge the CFTC to adopt a balanced approach. Support regulated prediction markets with targeted rules to address specific risks like manipulation, rather than broad restrictions that could stifle innovation or push activity offshore. These markets arent gambling; they serve real economic purposes, and I hope to keep using them as a valuable tool.
Thank you for considering my input.
Sincerely,
Benjamin Rothfuss
