Comment Text:
Dear Chairman and Commissioners,
My name is Jimmy Young, and I'm a trader and investor from the United States. Im writing to provide my input on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. As someone who actively trades on regulated US prediction markets like Kalshi and Polymarket, I strongly support the development of well-regulated event contracts. I believe these markets are a vital new financial tool for risk transfer and price discovery, and Im concerned that overly restrictive rules could stifle their potential.
Ive used event contracts for both investing and hedging purposes, and I can attest to their practical value. For instance, Ive hedged risks tied to other investments by taking positions on election outcomes and policy changes that could impact my portfolio. These markets let me offset exposure in ways that traditional instruments often cant match. Its not gambling; its a calculated decision based on research and real-world knowledge. Honestly, I often feel more confident assessing political or industry events than I do dissecting a companys balance sheet. I suspect a lot of everyday Americans feel the same, and event contracts give us access to markets tied to subjects we understand and follow closely.
I also want to emphasize that prediction markets serve legitimate economic purposes and shouldnt be classified as gaming. Theyre about price discovery and risk management, not just betting for kicks. Academic research backs this up, showing how these markets aggregate information more accurately than polls or pundits. That benefits everyone, not just traders like me. On top of that, the US should be leading in financial innovation, not ceding ground to other countries. If we over-regulate or ban broad categories of contracts, we risk pushing this activity to unregulated offshore platforms, which is far worse for consumer protection and transparency.
Addressing some of the specific questions in the ANPR, Id like to speak to Question 7 on balancing innovation and public interest, and Question 15 on defining gaming versus legitimate markets. For Question 7, I believe proportionate regulation that targets specific risks like manipulation or insider trading is the way to go, rather than sweeping prohibitions. The CFTC already has tools to address bad actors; use them instead of limiting access for the rest of us. For Question 15, event contracts tied to real-world outcomes have clear hedging and informational value, setting them apart from pure gaming.
I urge the CFTC to support the growth of prediction markets with targeted, fair rules. Dont let broad bans or over-restrictions undermine a tool that helps individuals and businesses manage real risks while keeping the US at the forefront of financial markets. Thank you for considering my perspective.
Sincerely,
Jimmy Young
