Comment Text:
Dear Chairman and Commissioners,
My name is Avery Bauer, and I'm an everyday citizen from California 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 development under fair and balanced regulation by the CFTC. I believe these markets offer unique benefits to people like me and to society as a whole, and I want to see the U.S. take a leadership role in this space.
I've always been frustrated by how often election polls and pundit predictions get things wrong. Prediction markets, from what I've seen, cut through the noise and provide forecasts that are often more accurate. That kind of information isn't just helpful for traders; it's valuable for everyone trying to make sense of public events. I also appreciate that these markets give regular folks like me a chance to participate in a legal, regulated space. Shutting out everyday citizens while letting big institutions dominate would keep all the good insights with them, which doesn't seem fair. Plus, I can see how these markets help people and businesses hedge real risks, like a small business owner planning around election outcomes that might affect taxes or regulations.
I'm also concerned about consumer protection. Regulated platforms like Kalshi, under CFTC oversight, seem far safer than unregulated offshore sites. If we over-restrict or ban these markets, people will just go elsewhere, to places with no protections. The U.S. should be leading in financial innovation, not handing that advantage to other countries. On top of that, I don't think event contracts are gambling. They take research and judgment, just like stock trading, and they serve real economic purposes like price discovery and risk management. Calling them "gaming" feels like a stretch.
Looking at some of the specific questions in the ANPR, I want to address a few points. On Question 7, about balancing innovation and consumer protection, I think the CFTC can achieve both by focusing on targeted rules rather than broad bans. For Question 15, on defining gaming versus legitimate markets, I urge you to recognize the economic value of event contracts and not lump them in with gambling. And for Question 29, about inside information, I believe informed trading actually improves price discovery for everyone. The CFTC already has strong tools to tackle manipulation and insider trading in other markets, and those can be applied here without shutting everything down.
I ask that the CFTC support proportionate regulation of prediction markets. Don't ban or overly restrict them. Craft rules that address specific risks while letting these markets grow and benefit the public. Thank you for considering my input.
Sincerely,
Avery Bauer
