Comment Text:
Dear Chairman and Commissioners,
My name is Jon Battice, and I'm a student from New York. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I strongly support the development of well-regulated prediction markets, and I hope my perspective as someone who has used these markets a few times can add to your considerations.
As a student, I don't have a lot of financial wiggle room, and I depend on prediction markets to help manage risks tied to caring for my mother. For instance, I've used these markets to hedge against economic events like inflation data releases that could impact costs for her medical needs or my own budget. This isn't just playing a game; it's a real tool for me to protect against uncertainty. I believe these markets also serve a broader purpose by providing better information for public decision-making. The prices on platforms like Kalshi often cut through the noise of polls and pundits, giving a clearer picture of what might happen. That benefits everyone, not just traders.
I'm also concerned about freedom to participate in legal, regulated markets. If prediction markets are banned or overly restricted, regular people like me get shut out, and activity just moves to unregulated offshore platforms where there's no oversight. I've seen firsthand how a regulated market like Kalshi offers transparency and safety that you won't find in sketchy offshore sites. Pushing trading underground doesn't solve problems; it creates them. The CFTC already has strong tools to tackle manipulation and insider trading in other derivatives markets. I trust those can be adapted here without resorting to broad bans.
On your questions about public interest and innovation, like in Questions 7 and 8, I think the U.S. should lead in financial innovation. If we stifle prediction markets, other countries will step in, and we'll lose the chance to set the standard. Also, regarding Question 29 on inside information, I believe informed trading actually helps price discovery. When people with knowledge trade, it makes the market's predictions sharper, which helps everyone relying on that data.
I also want to address the idea of event contracts as gambling, tied to Questions 15 and 16. These contracts aren't about luck; they're based on research and judgment, much like trading stocks. They serve real economic purposes, like hedging risks for individuals and businesses. Banning them would ignore their value.
I urge you to support proportionate regulation of prediction markets. Don't ban or over-restrict them. Focus on targeted rules to address specific risks while letting these markets grow under your oversight. Thank you for considering my input.
Sincerely,
Jon Battice
