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Comment for Proposed Rule 89 FR 48968

  • From: Yehuda Sugarman

    Comment No: 73737
    Date: 5/24/2024

    Comment Text:

    I have been a trader on political prediction markets for more than 15 years. I am currently active on both PredictIt and Kalshi. I strongly oppose the commission's effort to shut down election-based betting markets.

    The general public is strongly supportive of regulated betting markets for all types of contracts, from events to sports to politics. There is virtually no public opposition to these types of markets,. Peer-to-peer platforms like PredictIt are fun, safe and provide valuable data for political reporters, academics and researchers. They are a much more reliable tool for understanding the electorate than polls, whose ability to gauge public opinion has been vastly diminished in recent years.

    A legal, regulated and taxed political betting market is much safer to consumers than a black market or betting on offshore websites, which is where bettors like me will be forced to go if U.S. political prediction markets are shut down. These types of markets have been legally operating in Europe and other developed countries around the world for decades without negative consequences to consumers or elections. Consumers are better protected in legal, regulated markets that have oversight, integrity units and are subject to American financial and legal protections.

    The integrity of elections today is far more threatened by autocratic-leaning political leaders and foreign actors who seek to undermine the fairness and trust in our democratic electoral system. Clamping down on average Americans who seek a platform to trade with one another shuts down healthy political debate and free speech that actually engages voters in the political process. Overhanded government interference is more likely to have a chilling effect on political free speech and civic engagement.

    Given the proliferation of gaming, both online and at brick and mortar establishments, over the last 20 years it makes absolutely no sense to impose restrictions on event markets that actually have value to society and engage the public in important issues and topics, not simply the outcome of a sporting event.

    I strongly urge the commission to withdraw its proposed rule that attempts to ban political and election markets. An open, regulated market allows for government oversight, healthy market competition, and consumer protections that benefit ordinary investors.

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