Comment Text:
Dear Chairman and Commissioners,
My name is Lucas Camargo, and I'm a student in California with a strong interest in economics and public policy. I'm writing to provide my input on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I strongly support the development of well-regulated prediction markets, and I believe the CFTC has an opportunity to create a framework that balances innovation with consumer protection.
As a student, I've been fascinated by how prediction markets aggregate information and produce forecasts that often beat traditional polls or pundit opinions. I've seen firsthand how these markets provide insights into elections and other public events that you just can't get elsewhere. This isn't just academic curiosity for me. I use prediction markets to hedge personal financial risks tied to economic or political outcomes that could affect my future, like changes in student loan policies or tax laws. It's a practical tool, not a game.
I want to emphasize a few points. First, prediction markets aren't gambling. They serve real economic purposes, like hedging and price discovery. Classifying them as "gaming" undercuts their value, and I urge the CFTC to recognize this distinction when considering questions 15-22 on listed activities. Second, these markets help regular people like me manage risk. Whether it's a small business owner worried about regulatory changes or a student like me concerned about policy shifts, having access to these tools is empowering. Banning or over-restricting them would push activity to unregulated offshore platforms, which is far riskier for consumers. I'd rather see the CFTC regulate them properly here in the US, as touched on in questions 7-14 about public interest.
I'm also aware of concerns about manipulation or insider trading. But the CFTC already has strong tools to address these issues in other derivatives markets. I believe those can be adapted for event contracts without resorting to broad bans. On questions 29-32 about inside information, I'd argue that informed trading often improves price discovery, benefiting everyone by making forecasts more accurate. The focus should be on enforcing existing laws, not punishing all participants for the actions of a few.
Finally, the US should be a leader in financial innovation. If we over-regulate or ban prediction markets, we risk ceding ground to other countries. I hope the CFTC will consider proportionate, targeted rules rather than categorical restrictions, as discussed in questions 23-28 on procedural aspects.
I appreciate the chance to comment and urge the Commission to support a regulatory framework that allows prediction markets to thrive while protecting consumers. Let's keep this innovation accessible and safe right here in the US.
Sincerely,
Lucas Camargo
