Comment Text:
Dear Chairman and Commissioners,
My name is Henry Guo, and I'm a data science student from Massachusetts. I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516) to express my strong support for well-regulated prediction markets. As someone studying data science, I've found these markets to be an incredible real-world laboratory for testing machine learning models and applying classroom knowledge. Building models to predict outcomes on platforms like Kalshi and Polymarket has been a perfect project to sharpen my skills, and I believe these markets have broader value for society too.
I actively trade on prediction markets, and I've seen firsthand how they produce forecasts that are often more accurate than polls or pundits. For elections and public events, the aggregated wisdom of traders cuts through noise and bias in a way traditional methods can't match. This isn't just useful for traders like me; it provides better information for public decision-making and price discovery, benefiting everyone from policymakers to everyday citizens. Beyond that, these markets help individuals and businesses hedge real risks, like economic shifts or policy changes, in ways that traditional financial tools sometimes don't cover.
I also want to stress that regulated markets, like Kalshi, are far safer than unregulated offshore platforms. If the CFTC imposes overly strict rules or broad bans, activity will just move to less transparent venues, which helps no one. Event contracts aren't gambling, either. They serve legitimate economic purposes, requiring research and judgment, much like trading stocks or commodities. Classifying them as "gaming" feels like a misstep when their value in forecasting and hedging is so clear.
On the topic of informed trading, I believe it actually improves price discovery, as raised in Questions 29-32 of the ANPR. Traders with better data or insights make prices more accurate, which benefits all participants. The CFTC already has tools to address insider trading or manipulation, so the focus should be on enforcing those, not restricting entire markets. I'm also particularly interested in academic research and data transparency, as mentioned in Questions 7-14 on public interest. Prediction markets generate valuable data that researchers like me can use to study decision-making and forecasting. I'd urge the CFTC to ensure regulation supports access to this data for academic purposes.
As a student, I see prediction markets as a space for innovation and learning. I hope the CFTC will adopt proportionate, targeted rules rather than broad categorical bans. Address specific risks with specific solutions, and let these markets continue to grow under fair oversight. Thank you for considering my perspective.
Sincerely,
Henry Guo
