Comment Text:
Dear Chairman and Commissioners,
My name is Owen Voutsinas-Klose, and I serve as Vice President of Policy & Government Affairs at Viohl & Associates, a government relations firm based in Washington, DC. I'm writing to express my strong support for proportionate regulation of prediction markets in response to your Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). As both an active trader on platforms like Kalshi and Polymarket and a public policy professional who relies on these markets in my daily work, I've seen firsthand the value they provide, and I believe the CFTC has an opportunity to foster innovation while protecting consumers.
Prediction markets aren't a niche interest for me. I have been using them since I was 12 years old and betting on Aristotle's PredictIt. In my role advising clients on healthcare policy, state government affairs, and regulatory matters, I regularly include prediction market odds in client bulletins and analyses. When my clients need to understand the likelihood of a particular election outcome, the probability of a major regulatory action, or the trajectory of a pending policy decision, the ability to see what traders with real money on the line think the chances are is genuinely invaluable. The price discovery function of these markets, particularly for high-volume contracts on events with little realistic likelihood of manipulation such as election results, produces signals that are sharper and more accurate than polls, punditry, or conventional analysis. My clients make consequential business decisions based on policy forecasts, and prediction markets give me a tool to cut through noise and bias in a way that traditional sources simply cannot match.
This value extends well beyond my own practice. Journalists, policymakers, corporate strategists, and the public all benefit from reliable probabilistic signals about future events. In a media environment saturated with motivated reasoning and confirmation bias, prediction markets offer something rare: a price set by people willing to be wrong with their own money. That's a public good worth preserving.
I also want to be candid about a normative principle that informs my views: I don't believe the federal government should be in the business of regulating what consenting adults choose to do with their own money, particularly when the activity in question is already permitted in less efficient forms elsewhere in our financial system. Investors today routinely bet on political and policy outcomes indirectly through equity markets, currency positions, commodity contracts, and sector-specific ETFs. A trader who believes a particular candidate will win an election can buy or short defense contractors, healthcare companies, or energy producers as a proxy. A trader anticipating a Federal Reserve decision can position in interest-rate-sensitive assets. These indirect bets are legal, common, and frankly less efficient than simply trading the underlying event itself. Prediction markets allow people to express the same views directly, with cleaner pricing and lower transaction costs. Prohibiting the direct version while permitting the indirect version isn't consumer protection; it's an arbitrary distinction that benefits sophisticated investors with access to complex hedging strategies at the expense of ordinary people who would prefer a more transparent instrument.
I also use these markets to hedge personal financial risks. I've traded contracts tied to economic indicators that could affect my budget and career planning. This isn't gambling; it's a practical way to manage uncertainty, much like any other derivative market. Event contracts serve real economic purposes, from price discovery to risk management, and shouldn't be lumped in with gaming.
On some of your specific questions, particularly those in Topic B (Questions 7-14) on public interest, I think the CFTC must balance innovation with oversight. Banning or over-restricting prediction markets won't eliminate demand; it will push activity to unregulated offshore platforms where there's no consumer protection at all. The US should lead in financial innovation, not cede ground to other jurisdictions. On Topic E (Questions 29-32) regarding inside information, I believe informed trading actually improves price discovery. It makes markets more accurate, which benefits everyone, not just traders. Existing laws already prohibit insider trading by federal employees, so the focus should be on enforcement of those rules rather than blanket prohibitions on the markets themselves.
Concerns about manipulation and misuse are real, and I take them seriously. But the CFTC already has powerful tools to combat fraud and manipulation in other markets, and those can be adapted here. Shutting down or overly restricting prediction markets punishes legitimate users like me and my clients, and stifles a growing industry that can keep the US competitive in financial in
