Comment Text:
Dear Chairman and Commissioners,
My name is Arturo Londono, and I'm a trader and investor based in California. I've been involved in various financial markets for years, and I've used prediction markets a few times to inform my decisions and hedge against uncertainty. I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516) to express my strong support for well-regulated prediction markets. I believe they provide unique value to people like me and to society as a whole, and I urge the CFTC to craft rules that support their growth without over-restricting them.
As someone who analyzes markets for a living, I can tell you that prediction markets often produce forecasts that are far more accurate than polls or pundits. I've seen this firsthand when I used a platform to gauge the likelihood of certain economic policy changes. The aggregated wisdom of many traders, each putting their money where their mouth is, gave me insights I couldn't find anywhere else. This isn't just helpful for investors like me; it's valuable for the public, businesses, and even policymakers who need reliable data to make decisions.
I also want to stress that event contracts are not gambling. They serve real economic purposes, like hedging risk and discovering prices for uncertain outcomes. When I trade on these platforms, I'm not rolling dice; I'm researching, analyzing, and making informed judgments, just as I do with stocks or commodities. Treating these markets as "gaming," as discussed in Questions 15-22 of the ANPR, would be a mistake. It ignores the legitimate role they play in our financial system.
Another concern I have is where trading happens. Regulated markets like Kalshi, operating under CFTC oversight, are far safer than unregulated offshore platforms. If the CFTC imposes overly strict rules or bans certain contracts, people won't stop trading; they'll just move to less secure venues with no oversight. I think the CFTC should focus on keeping activity within regulated spaces, as touched on in Questions 7-14 about balancing innovation and consumer protection.
Lastly, I believe the CFTC already has strong tools to handle issues like manipulation and insider trading, as raised in Questions 29-32. These are real concerns, no doubt, but the answer isn't to shut down prediction markets. It's to enforce the laws already on the books. Banning or over-restricting these markets punishes honest traders like me while bad actors just find ways around the rules.
I appreciate the CFTC taking a thoughtful approach with this ANPR and seeking public input. I strongly encourage you to support proportionate regulation that allows prediction markets to thrive while addressing specific risks with targeted measures. Let's not throw out a valuable tool because of fears that can be managed with existing authority.
Sincerely,
Arturo Londono
