Comment Text:
Dear Chairman and Commissioners,
My name is Chris Clemente, and I'm just 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've used prediction markets a few times, and I believe they have value when regulated properly. I'm not an expert or a big trader, but I care about having the freedom to participate in legal, regulated markets, and I want to weigh in on how the CFTC approaches this.
I support prediction markets for most topics because they provide unique information that you can't find elsewhere. I've seen firsthand how the prices on these platforms often reflect real-world outcomes better than news or polls. They're not just for traders; they help regular people like me understand trends and make informed decisions. I also think allowing everyday folks to participate is fair. If only big institutions can trade, they keep all the insights to themselves, and that doesn't seem right. Plus, these markets aren't gambling in my view. They take research and judgment, much like investing in stocks.
That said, I have concerns about prediction markets tied to politics, elections, or government matters. I don't think there should be trading on those topics. It feels too close to gambling and could invite manipulation or bad incentives around something as serious as our democratic process. I'd urge the CFTC to draw a clear line there and exclude those subjects from event contracts altogether.
On the broader issue of regulation, I believe the CFTC should focus on proportionate, targeted rules rather than broad bans. I'm worried that over-restricting or shutting down entire categories of prediction markets punishes regular users like me for the actions of a few bad actors. Insider trading and manipulation are already illegal, and the CFTC has tools to enforce those laws. Use them. Don't ban markets to stop a problem that can be addressed with existing authority. I think this ties directly to Questions 29-32 in the ANPR about insider trading. Informed traders can help make prices more accurate, but the focus should be on enforcing rules against abuse, not restricting access for everyone.
I also want to touch on Question 7 from the public interest section of the ANPR. Innovation matters, but so does protecting consumers. Targeted regulation can balance both by addressing specific risks without stifling the benefits of prediction markets for non-political topics like economic data or weather events.
In closing, I ask the CFTC to support proportionate regulation of prediction markets. Please allow these platforms to operate for most subjects under clear, fair rules, while excluding politics, elections, and government matters. Don't over-restrict or ban them outright. Thanks for considering my perspective.
Sincerely,
Chris Clemente
