Comment Text:
I am submitting this comment as a member of the public and a current user of prediction market platforms, including Polymarket and Kalshi. I write in support of the Commission using this rulemaking to impose meaningful restrictions on sports related and gaming adjacent event contracts, which I believe are functioning as a de facto national online gambling system operating outside the consumer protections that govern licensed gaming.
I want to be direct: I use these platforms primarily to bet on sports outcomes. The interface, the product design, and the user experience are indistinguishable from a sportsbook. I do not use them to hedge financial risk or gain informational insight into real world probabilities. I wager on game outcomes because it is easy, accessible, and currently legal under federal oversight, not because of any legitimate economic purpose the contracts serve.
I do not believe I am unique. The explosive growth in event contracts, from a handful per year to over 1,600 self certified in 2025, is not driven by a sudden surge in demand for price discovery on sporting events. It is driven by the appetite for legal, convenient sports gambling in a country where state by state licensing has historically constrained access. These platforms have identified a regulatory gap and exploited it.
The CEA grants the Commission authority to prohibit event contracts it determines are contrary to the public interest, including those involving gaming. I urge the Commission to use this rulemaking to clearly define sports related event contracts as falling within that prohibition. The fact that these contracts are structured as binary derivatives does not change their social function, their target audience, or the harms they can cause.
Licensed sports gambling operates within consumer protection frameworks, including responsible gambling tools, age verification standards, self exclusion programs, and addiction resources, because states recognized those safeguards are necessary. Prediction markets operating under federal derivatives law currently face no equivalent requirements. This is not responsible innovation; it is regulatory arbitrage that leaves consumers exposed.
The Commission should also take seriously the manipulation and insider trading concerns raised throughout this comment period. I have personally observed price movements on these platforms that appear to anticipate public announcements by hours. Whether or not the Commission concludes that insider trading rules formally apply, the appearance of unfairness undermines the integrity of these markets and harms ordinary participants.
I respectfully urge the Commission to:
1. Formally determine that sports related event contracts are contrary to the public interest under CEA Section 5c(c)(5)(C) and prohibit their listing on registered exchanges.
2. If sports contracts are permitted in any form, require platforms to implement consumer protection standards equivalent to those required of licensed sportsbooks, including deposit limits, self exclusion programs, and problem gambling disclosures.
3. Clarify that manipulation and misappropriation of non public information are prohibited in prediction markets and commit to active enforcement.
The Commission has an opportunity to get ahead of a significant and growing harm. I hope it will take it.
Respectfully submitted,
Porter Young
Caldwell, Idaho
