Comment Text:
Dear Chairman and Commissioners,
My name is Andrew Galletta, and I'm a trader and investor based in Pennsylvania. I'm writing to express my strong support for the proportionate regulation of prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). As someone who actively uses these markets to hedge financial risks and gain insights, I believe they provide immense value to individuals like me, as well as to society at large, and should not be overly restricted or banned.
I've relied on prediction markets for years to manage risks tied to my investments. For instance, I use them to hedge against uncertainties like election outcomes or economic policy shifts that could impact my portfolio. The forecasts these markets produce are often more accurate than polls or pundits, giving me information I can't find in traditional news media. This isn't just helpful for me; it lowers the cost of insight and levels the playing field between retail investors like myself and big institutions. We're not gambling here. Trading on prediction markets requires research and judgment, much like trading stocks or commodities. Classifying event contracts as "gaming," as discussed in Questions 15-22, ignores their legitimate economic purpose, whether it's price discovery or risk management.
I also see broader benefits. Prediction markets aggregate information efficiently, helping everyone, from regular folks to policymakers, make better decisions. Academic research backs this up, showing how these markets improve forecasting. On top of that, informed trading, as raised in Questions 29-32, actually enhances price discovery. It doesn't hurt the market; it helps everyone by making prices more accurate. And for those worried about insider trading or manipulation, Ill point out that the CFTC already has strong tools to tackle these issues. Banning or over-restricting markets, as hinted at in some of the public interest questions like 7-14, isn't the answer. It just pushes activity to unregulated offshore platforms, which is far riskier.
The U.S. should be leading in financial innovation, not ceding ground to other countries. If we over-regulate, we lose that edge. I'm not saying there shouldn't be rules. I support sensible regulation to protect consumers and ensure fair play. But broad bans or treating these markets as gambling punishes responsible users like me who rely on them for real financial decisions. People will always find ways to speculate irresponsibly, but the state shouldn't restrict valuable tools for the rest of us in the name of stopping a few bad actors.
I urge the CFTC to craft rules that support well-regulated prediction markets while addressing specific risks with targeted solutions. Lets keep these markets accessible, legal, and safe for everyday investors like me. Thank you for considering my perspective.
Sincerely,
Andrew Galletta
