Comment Text:
Dear Chairman and Commissioners,
My name is Daniel Mathis, and I'm an everyday citizen from Idaho writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I'm new to prediction markets, but I strongly support their existence under fair and reasonable regulation. I believe they offer real value to people like me, and I want to see the CFTC approach this with an open mind.
I've always been frustrated by how hard it is to get reliable information about what's happening in the world. Polls and pundits often get it wrong, but I've read about how prediction markets consistently produce more accurate forecasts by pooling what people know into prices. That kind of information isn't just useful for traders; it helps everyone, from regular folks like me to businesses and even policymakers. I also see these markets as a way for ordinary people to participate in something meaningful. They're not gambling, in my view. Trading on events takes research and judgment, much like investing in stocks. Calling it "gaming" feels like a stretch when these contracts help people hedge real risks, like a small business owner protecting against policy changes or someone like me worrying about economic shifts.
I'm glad platforms like Kalshi are regulated by the CFTC. That oversight makes them safer than unregulated offshore sites where there's no accountability. If we ban or over-restrict these markets, people won't just stop trading; they'll go to those shady platforms instead. The US should be leading the way on financial innovation, not pushing it overseas. I also believe the CFTC already has strong tools to handle issues like manipulation or insider trading. There's no need for heavy-handed bans when targeted rules can address specific problems. Plus, informed trading actually helps make prices more accurate, which benefits everyone in the market.
I noticed a few questions in the ANPR that relate to my concerns. For Question 8 under Public Interest, about balancing innovation and protection, I think allowing regulated prediction markets strikes the right balance. For Question 15 on Listed Activities, regarding whether event contracts are gaming, Id argue they serve legitimate economic purposes like hedging and shouldn't be lumped in with gambling. And for Question 29 on Inside Information, I believe informed traders improve price discovery, as long as existing laws against insider trading are enforced.
I urge the CFTC to support proportionate regulation of prediction markets. Don't ban or over-restrict them. Focus on targeted rules to address real risks while letting regular people like me participate in legal, regulated markets that provide valuable information and ways to manage uncertainty. Thank you for considering my input.
Sincerely,
Daniel Mathis
