Comment Text:
Dear Chairman and Commissioners,
My name is Cobyn Tuggle, and I'm a student from Indiana 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 offer real value, both to me as an individual and to society at large. I'm concerned about the potential for over-restriction or bans, and I want to urge the CFTC to support proportionate regulation instead.
As a student, I've found prediction markets to be a unique way to engage with real-world events. They're not just a pastime; they help me think critically about politics, economics, and even cultural trends. I've placed a few small trades on platforms like Kalshi, and it's been eye-opening to see how these markets aggregate information. The prices often reflect outcomes more accurately than polls or news pundits. That's useful for everyone, not just traders. I strongly believe that regular people like me should have the freedom to participate in legal, regulated markets. Shutting out individuals while letting big institutions dominate would keep valuable information out of public reach, which feels unfair.
I also want to address some concerns head-on. I know theres worry about these markets being akin to gambling, but I disagree. Trading on event contracts isn't a game of chance; it takes research and judgment, much like investing in stocks. Classifying them as "gaming," as discussed in Questions 15-22 of the ANPR, ignores their legitimate economic purpose, like price discovery and hedging. For instance, I could see myself using these markets in the future to hedge personal financial risks tied to policy changes or economic data releases.
Another big concern for me is the risk of over-regulation or outright bans pushing activity to unregulated offshore platforms. I've read about offshore sites that operate with little oversight, and they seem far riskier than a regulated platform like Kalshi, which operates under CFTC rules. If the U.S. clamps down too hard, people won't stop trading; they'll just go to less safe venues. On this point, I think Question 7 from the ANPR, about balancing innovation and consumer protection, is critical. Regulation should protect users without stifling access.
Finally, I believe the U.S. should lead in financial innovation. If we over-restrict prediction markets, were handing the advantage to other countries that embrace this technology. We have the chance to set a global standard with smart rules, not cede the field. I hope the CFTC considers these points, especially in Questions 33-40 about classification and costs, and crafts rules that keep markets accessible to everyday people like me.
Thank you for considering my input. I strongly support proportionate regulation of prediction markets, not bans or overly restrictive policies that would harm innovation and access.
Sincerely,
Cobyn Tuggle
