Comment Text:
Dear Chairman and Commissioners,
My name is Kevin Schwartz, and I'm just an everyday citizen from Illinois writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've used prediction markets a few times, and I strongly support regulating them in a way that keeps them accessible while addressing real concerns. I think these markets have value for people like me, and I want to explain why.
First off, I don't see prediction markets as gambling. When Ive traded on them, it wasn't a game of chance. It took research and thought, much like deciding to invest in a stock or mutual fund. These markets let me hedge against things that impact my life, like election outcomes that could change tax policies or economic decisions that affect my costs. Thats not a bet; its managing risk. Plus, the prices on these platforms often give better insights than polls or news. That information helps everyone, not just traders.
I also believe regular people should have the freedom to participate in legal, regulated markets. Platforms like Kalshi, which operate under CFTC oversight, are far safer than unregulated offshore sites. If the U.S. bans or over-restricts these markets, people will just go to those less safe options. Id rather see the CFTC keep activity here, under its watch, where consumer protections can actually be enforced. On top of that, the U.S. should be leading in financial innovation. We shouldnt let other countries take the lead on something this promising.
I know there are worries about manipulation or insider trading, and those are valid. But the CFTC already has strong tools to tackle those issues in other markets. Use them here too. Dont punish everyone by shutting down something useful because of a few bad actors. And honestly, when informed traders participate, it makes the prices more accurate. That benefits all of us.
Looking at some of your specific questions, like those in Topic B on public interest (Questions 7-14), Id say the balance should lean toward innovation with smart oversight, not heavy restrictions. And for Topic E on inside information (Questions 29-32), I think informed trading often helps price discovery, as long as existing laws against insider abuse are enforced.
Im asking you to support proportionate regulation of prediction markets. Keep them open to people like me, with rules that address risks without killing the benefits. Thank you for considering my perspective.
Sincerely,
Kevin Schwartz
