Comment Text:
I’m writing to urge the Commission to take clear, decisive action on event contract derivatives traded on prediction markets.
The direction these markets are heading raises real concerns about market integrity, insider trading, and the growing tendency to turn everything, including matters of life, death, and governance, into something to bet on. Contracts tied to military operations, foreign policy decisions, terrorism, or political violence create unacceptable risk. People with nonpublic information about these events would have both the opportunity and the financial incentive to act on it. Even the perception that government decisions could be influenced by private financial gain undermines public trust.
The Commission should draw a firm line. Event contracts involving military operations, acts of war, terrorism, political assassinations, and non-financial government decisions should be explicitly prohibited as contrary to the public interest.
There’s also a broader issue. Any contract where the outcome can be known in advance, or influenced by a small group, is inherently vulnerable to manipulation. That includes award shows, political speeches, corporate announcements, and similar events where insiders have definitive advance knowledge. These should face a strong presumption against approval.
The Commission has both the authority and the responsibility under the Commodity Exchange Act to act here. I urge you to prohibit these categories of contracts, strengthen surveillance and enforcement to detect insider activity, and prioritize market integrity and public trust over industry expansion.
Not everything should be financialized. Decisions about war, governance, and human lives should remain outside the reach of speculation. This rulemaking is an opportunity to set that boundary clearly and responsibly.
