Comment Text:
Dear Commodity Futures Trading Commission,
I am writing to express my deep concern and disappointment regarding your potential categorization of election event contracts as gaming activities that are contrary to the public interest. As a citizen deeply invested in the quality of our democratic processes and public discourse, I strongly believe that prediction markets have significant potential to enhance and elevate our political conversations and decision-making.
Prediction markets, when properly implemented and regulated, serve as powerful tools for aggregating information and forecasting outcomes. In the context of elections, they can provide valuable insights into public sentiment, candidate viability, and potential policy impacts. By allowing individuals to "put their money where their mouth is," these markets often cut through partisan rhetoric and media bias, offering a more objective view of political landscapes.
But I think their most important benefit is one well outlined by Scott Alexander:
'They short-circuit discussion of “which expert should we trust?” or “how do we know which sources are biased?” All prediction markets speak with a single unified voice, that voice will always be at least as trustworthy as any individual expert, and it cannot be biased. If you’re not sure which of many competing experts (or supposed experts) to trust, you should always trust a prediction market instead of any of them. And the same is true of people on the opposite side of the political spectrum who doubt all the sources you trust and vice versa.
According to Pew Research , a poll of experts named “the breakdown of trusted information sources” as one of the leading challenges of the 21st century (who are these “experts”? was the poll fair? did Pew really say this, or am I making it up?) Millions of words have been written on how to solve this crisis, with most ideas being impossibly naive or dangerously authoritarian. I think prediction markets are a genuine solution, one that can’t come fast enough.'
https://www.astralcodexten.com/p/prediction-market-faq
I understand that the CFTC may be hesitant to approve such markets due to concerns about the regulatory burden of verifying election results and prosecuting potential election fraud. However, I believe these concerns are misplaced, that there are other agencies with the responsiblity for ensuring the security of our elections, and we should not let these concerns outweigh the substantial public benefits that prediction markets can offer. The CFTC's primary mission should be to serve the public interest, and in this case, that interest is best served by fostering tools that enhance political understanding and engagement.
I urge the CFTC to reconsider its position on election event contracts and to work towards developing a regulatory framework that allows for the responsible operation of political prediction markets. The potential benefits to our democratic process and public discourse are too significant to ignore.
I strongly believe that properly regulated election event contracts and prediction markets are not only in the public interest but could become vital tools for strengthening our democracy in an era of increasing polarization and misinformation. Thank you for your attention to this matter. I look forward to seeing the CFTC take a forward-thinking stance on this important issue.
