Comment Text:
Dear Chairman and Commissioners,
My name is Michael Peterson, and I'm just an everyday citizen from Mississippi writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've used prediction markets a few times, and I believe they have real value for people like me. I want to urge the CFTC to support well-regulated prediction markets instead of banning or over-restricting them.
I run a small business here in Mississippi, and the uncertainty of things like elections or policy changes can hit my bottom line hard. I've turned to prediction markets to hedge some of that risk. For instance, I placed a small trade on a platform last year to offset potential tax changes after an election that could have affected my costs. It wasn't gambling; it was a practical way to protect myself. These markets give regular folks like me a tool to manage real financial risks, something I can't get from traditional investments alone.
What worries me is the idea of pushing these markets underground. I've seen how regulated platforms like Kalshi operate with clear rules and oversight. That feels a lot safer than the unregulated offshore sites out there. If the CFTC clamps down too hard or bans these markets, people aren't going to stop trading. They'll just go to sketchy platforms with no protections. I'd much rather see the CFTC focus on keeping these markets regulated and above board in the U.S. so we have a safe place to participate.
I also think it's worth noting that when informed traders participate, it helps everyone. Their knowledge makes the prices more accurate, which benefits me even if I'm not an expert. I can look at those prices and get a better sense of what's likely to happen, whether it's a policy shift or an economic event. Banning or limiting who can trade just keeps that information locked away from regular people. On this point, I'm thinking of Question 29 from your ANPR about whether informed traders help price discovery. My answer is yes, they absolutely do, and we shouldn't restrict that.
I'm not blind to the risks. I know insider trading or manipulation could be a problem. But those are already illegal, and the CFTC has the power to enforce against bad actors. Shutting down entire markets to stop a few cheaters feels like punishing everyone for the actions of a few.
I hope you'll consider my perspective as a regular Mississippian who sees real value in these markets. Please support proportionate regulation that keeps prediction markets legal and safe for people like me to use, without driving activity offshore or locking out everyday citizens.
Sincerely,
Michael Peterson
