Comment Text:
I submit this comment in my individual capacity. The views expressed are my own and do not represent the views of my employer or any affiliated organization.
Dear Secretary Kirkpatrick:
I submit this comment in response to the Commodity Futures Trading Commission’s Advance Notice of Proposed Rulemaking on Prediction Markets, RIN 3038-AF65.
I support the Commission’s effort to create a clear and durable regulatory framework for prediction markets. Prediction markets may serve useful purposes, including information aggregation, risk transfer, and market-based forecasting. At the same time, the Commission should draw clear boundaries for sports-related event contracts that closely resemble traditional sports wagering.
Contracts based on sporting-event outcomes, player performance, in-game events, tournament results, or similar sports contingencies can raise policy issues that states and tribal governments already address through sports wagering laws, responsible-gaming rules, integrity monitoring, age and location controls, and, where applicable, tribal-state gaming compacts. These frameworks reflect important sovereign interests and consumer-protection choices.
The Commission should ensure that sports-related event contracts do not operate as a substitute channel for retail sports wagering in a manner that bypasses applicable state or tribal gaming frameworks. Where a state or tribal government has established a lawful sports wagering regime, CFTC-regulated sports event contracts should be harmonized with, and not used to evade, that regime’s licensing, geolocation, age-verification, responsible-gaming, integrity-monitoring, and consumer-protection requirements.
A balanced framework should preserve room for responsible prediction-market innovation while respecting state and tribal authority over sports gambling. The Commission should clarify how CEA section 5c(c)(5)(C), including its reference to “gaming,” applies to sports-related event contracts and should consider whether additional safeguards are needed when a contract is economically and practically similar to sports betting.
Thank you for considering these comments.
Respectfully submitted,
Alex Brooks
