Comment Text:
Dear Chairman and Commissioners,
My name is Gavan Leon, and I'm just an everyday citizen from Arizona writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've been following prediction markets for a while, though I don't trade myself. Still, I see their value and want to urge the CFTC to support well-regulated prediction markets with proportionate rules, not bans or heavy restrictions.
I believe prediction markets offer something unique. They're often more accurate than polls or pundits when it comes to forecasting elections or other big events. I've seen this firsthand, checking platforms like Kalshi or reading about academic studies that back this up. That kind of information isn't just helpful for traders; it's useful for everyone, including regular folks like me who want better data to understand what's happening in the world. Plus, these markets let people and businesses hedge real risks. For example, a small business owner here in Arizona might use them to offset uncertainty around federal policies or economic shifts. That's not gambling, it's practical.
I also think event contracts shouldn't be labeled as gaming. They serve real economic purposes like price discovery and risk management, much like other financial tools. Calling them gambling feels like a stretch when you look at the research and judgment that goes into trading. I'm not saying there aren't risks, like manipulation or insider trading. But the CFTC already has strong tools to handle those issues in other markets. Why not adapt them here instead of over-restricting or banning entire categories of contracts? Shutting down these markets would just push activity to unregulated offshore platforms, which are far less safe for consumers. I've read about some of these foreign sites, and they lack the oversight a regulated market like Kalshi has under CFTC rules. Let's keep this activity here, under your watch.
I'm also concerned about the US falling behind. We should be leading in financial innovation, not ceding ground to other countries. And on the flip side, allowing informed trading in these markets actually helps everyone by improving price discovery. That benefits the public, not just traders. I think this ties into some of your questions, like numbers 7 and 29, about balancing innovation with consumer protection and the role of informed traders. My take is simple: regulate smartly to protect people, but don't kill the market in the process.
As someone who values the freedom to participate in legal, regulated markets, I ask the CFTC to focus on targeted rules that address specific risks without broad bans. Keep prediction markets accessible and safe under your oversight. Don't push them offshore or out of reach for regular Americans like me who see their potential.
Thank you for considering my input.
Sincerely,
Gavan Leon
