Comment Text:
Dear Chairman and Commissioners,
My name is Rufus Peabody, and I'm a trader and investor from the United States. I actively market make and trade on prediction markets like Kalshi and Polymarket, and Im writing to express my strong support for proportionate, well-regulated prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I've spent years honing my skills in these markets, and I believe they serve a vital purpose for individuals like me and for society as a whole.
Prediction markets aren't just a niche interest for me; they're a critical tool. I use them to assess probabilities on events that impact my financial decisions, from elections to economic indicators. The prices in these markets often provide insights I can't get from polls or news outlets. They're not gambling. They require research, analysis, and real-world judgment, much like trading stocks or commodities. Banning or over-restricting these markets would be a mistake, especially because it would push activity to unregulated offshore platforms. I've seen how easy it is to access those sites, and they lack the oversight and consumer protections that CFTC-regulated markets like Kalshi provide. Driving traders like me to less safe venues doesn't solve problems; it creates them.
I also want to stress that informed trading, which some might worry about as "insider trading," actually improves price discovery. When knowledgeable participants trade, the market prices become more accurate, and that benefits everyone, not just traders. The CFTC already has tools to address manipulation and true insider trading. I'd rather see those tools enforced than see broad categorical bans that punish legitimate participants. Targeted regulation makes more sense than sweeping restrictions.
Regarding some of the specific questions in the ANPR, Id like to address Question 29 under the "Inside Information" section. Yes, informed traders do help price discovery. Their participation makes the market's predictions sharper, which is a public good. And for Question 7 under "Public Interest," I believe the balance between innovation and consumer protection lies in regulation that focuses on specific risks, not blanket prohibitions. Lets keep these markets accessible to everyday traders like me while ensuring bad actors are held accountable.
I urge the CFTC to support the freedom to participate in legal, regulated prediction markets. Don't let over-restriction or outright bans push this valuable activity into the shadows. Craft rules that address real concerns without undermining the benefits these markets provide. Thank you for considering my perspective as you move forward with this rulemaking process.
Sincerely,
Rufus Peabody
