Comment Text:
Dear Chairman and Commissioners,
My name is Alexander Johnston, and I'm writing from Maryland where I work in defense technology. I'm reaching out to comment on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I actively trade on platforms like Kalshi, and I strongly support the CFTC crafting proportionate regulations for prediction markets rather than imposing broad bans or overly restrictive rules.
In my line of work, accurate forecasting of public events, like elections or policy shifts, is critical. Prediction markets provide insights I can't get from polls or news outlets. They've consistently outperformed traditional sources in predicting outcomes, and that information helps me make better decisions, both personally and professionally. Beyond forecasting, I use these markets to hedge financial risks tied to political or economic events that could impact my business interests or personal finances. For instance, trading on election outcomes helps me manage uncertainties around defense policy changes that affect my industry.
What I value most is the freedom to participate in legal, regulated markets like Kalshi. These platforms operate under oversight, with safeguards in place, making them far safer than unregulated offshore alternatives. If the CFTC over-restricts or bans prediction markets, it won't stop trading; it will just push activity to less secure, unregulated venues outside U.S. jurisdiction. Thats a loss for consumer protection and for U.S. leadership in financial innovation. We should be setting the standard for how these markets operate globally, not ceding that role to other countries. I believe the U.S. has a chance to lead in this space, and Id hate to see us fall behind.
I also want to address some of the concerns raised in the ANPR, particularly around public interest and procedural aspects, like Questions 7 and 23. I understand the need to balance innovation with consumer protection, but broad categorical bans arent the answer. Targeted rules addressing specific risks, like manipulation or insider trading, would be far more effective. The CFTC already has tools to tackle these issues in other markets, and they can adapt those here without shutting down an entire industry. Banning markets to stop a few bad actors feels like overkill and punishes those of us who use these platforms responsibly.
I urge the CFTC to support well-regulated prediction markets with rules that encourage innovation while addressing real risks. Let's keep these markets safe, accessible, and under U.S. oversight, rather than driving them offshore. Thank you for considering my perspective.
Sincerely,
Alexander Johnston
