Comment Text:
Dear Chairman and Commissioners,
My name is Gavonnie Stewart, and I'm a trader and investor based in Texas. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I'm relatively new to prediction markets, but I've taken a strong interest in them, and I believe they deserve thoughtful, proportionate regulation rather than heavy-handed restrictions.
As someone who spends a lot of time researching and trading in traditional markets, I see prediction markets as a valuable tool, not a game. These aren't gambling platforms; they serve real economic purposes like price discovery and risk hedging. Ive read about how platforms like Kalshi, which operate under CFTC oversight, provide a safe and transparent space for people like me to participate. Thats a far better option than pushing activity to unregulated offshore sites where theres no accountability. If the U.S. wants to lead in financial innovation, we need to foster these markets here with clear rules, not drive them away to other countries.
I also believe that informed trading in prediction markets isnt a problem; its a strength. When people bring knowledge to the table, it improves price accuracy, and that benefits everyone, not just traders. Academic research backs this up, showing how these markets aggregate information more effectively than polls or pundits. Transparency in data and pricing is key, and regulated markets are the best way to ensure that. Im particularly drawn to how prediction markets democratize access to information, letting regular folks like me have a stake in understanding and forecasting real-world events.
Regarding some of the specific questions in the ANPR, Id like to address Question 8 under Public Interest, about balancing innovation and consumer protection. I think the CFTC can strike that balance by focusing on strong oversight of platforms like Kalshi, ensuring theyre safe for participants while still allowing innovation to grow. Also, on Question 15 under Listed Activities, about defining gaming versus legitimate markets, I strongly feel event contracts shouldnt be lumped in with gambling. They require research and judgment, just like trading stocks or commodities.
Im not blind to concerns like manipulation or insider trading, but the CFTC already has tools to tackle those issues. Banning or over-restricting prediction markets punishes honest participants and sends innovation elsewhere. I urge you to support regulated prediction markets with rules that address specific risks without stifling their potential.
Thank you for considering my perspective.
Sincerely,
Gavonnie Stewart
