Comment Text:
I am writing to urge the Commission to take strong regulatory action regarding event contract derivatives traded on prediction markets. The current trajectory of prediction markets raises serious concerns about market integrity, insider trading, and the commodification of events that should remain outside the realm of financial speculation. Event contracts that allow wagering on military operations, foreign policy decisions, terrorism, assassination, or other government actions create unacceptable risks because individuals with nonpublic information about those decisions have both the opportunity and financial incentive to exploit that information. When citizens perceive that government decisions may be influenced by private financial interests, it erodes public trust, and the current complete lack of regulatory oversight for these "prediction markets", as well as the way the current administration seems to benefit from these markets, has already almost completely eroded trust in our institutions.
Furthermore, the very concept of wagering on human lives via placing bets on warfare and assassinations is fundamentally immoral and should have no place being allowed to continue. I would like to ask that you imagine this concept in the context of any other betting organization. For example, say a sports betting company allows people to wager on if an athlete will die in their next game, or from an illness that has them hospitalized. Why is it different with these "prediction markets" in the context of terrorism and acts of war?
I respectfully ask that the Commission explicitly prohibit event contracts related to military operations, acts of war, terrorism, political assassinations, and non-financial government policy decisions as contrary to the public interest. Allowing these markets to allow this kind of content keeps open an extremely obvious and highly exploitable method for corruption and insider trading to occur. In addition, any event contract where the outcome can be known in advance or controlled by a specific individual or small group is inherently susceptible to manipulation and should face a presumption against approval. This includes award show results, political speeches, corporate announcements, and any event where insiders have definitive advance knowledge.
The Commission has both the authority and responsibility under the Commodity Exchange Act to establish clear prohibitions on event contracts that are contrary to the public interest. I respectfully request that the Commission prohibit these dangerous categories of event contracts, strengthen surveillance and enforcement mechanisms to detect insider trading, and prioritize market integrity and public welfare over industry growth. The financialization of every aspect of human life, including war, death, and governance, should not proceed without meaningful guardrails, and the Commission's action on this rulemaking will signal whether our regulatory framework prioritizes public welfare or permits the commodification of matters that should remain beyond the reach of financial speculation.
