Comment Text:
Dear Chairman and Commissioners,
My name is Tyler Pardun, and I'm a student from Oklahoma with a strong interest in academic research and data transparency. I'm writing to comment on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. As someone who actively trades on platforms like Kalshi and Polymarket, Ive seen firsthand the value these markets provide, and I want to urge the CFTC to support proportionate regulation rather than overly restrictive rules or outright bans.
Prediction markets aren't just a hobby for me; they're a tool for understanding the world. As a student, I rely on them for accurate forecasting of elections and major public events, often finding their predictions more reliable than polls or pundits. The data they generate is invaluable for research, offering insights into public sentiment and probabilities that I can't get elsewhere. Beyond that, these markets help individuals and businesses hedge real risks. For example, a small business owner in Oklahoma could use them to offset uncertainty around policy changes or economic shifts tied to election outcomes. This isn't gambling; it's a legitimate economic activity that mirrors the judgment and research skills needed for traditional investing.
I understand concerns about manipulation or insider trading, but the CFTC already has strong tools to address these issues. Laws against insider trading apply to federal employees and others with nonpublic information, and your existing authority to combat market manipulation covers prediction markets too. Banning or over-restricting these markets won't solve bad behavior; it will just push activity to unregulated offshore platforms, which are far less safe than regulated markets like Kalshi. The US should be leading in financial innovation, not ceding ground to other countries by driving this activity out of reach of your oversight.
On specific questions in the ANPR, Id like to address a few points. Regarding Questions 7-14 on public interest, I believe prediction markets serve the public by improving price discovery and forecasting accuracy, especially when informed traders participate. Their input makes prices more accurate, benefiting everyone, not just traders. On Questions 15-22 about listed activities, I strongly feel event contracts shouldn't be classified as gaming. They serve real economic purposes like hedging and information aggregation. And on Questions 29-32 about inside information, I think the focus should be on enforcing existing laws rather than broad restrictions that hurt legitimate participants.
I'm not naive about the risks, but the answer isn't to shut these markets down. Proportionate, targeted regulation can address specific problems without punishing everyone. Regulated markets are safer, and they keep the US at the forefront of innovation. Please support a framework that allows prediction markets to thrive under fair oversight, not heavy-handed bans or restrictions.
Thank you for considering my input.
Sincerely,
Tyler Pardun
