Comment Text:
Dear Chairman and Commissioners,
My name is Noah Javier, and I'm a student from California. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've been actively trading on platforms like Kalshi and Polymarket for a while now, and I believe these markets offer real value to people like me and to society as a whole. I strongly support the CFTC developing proportionate regulations for prediction markets rather than imposing broad bans or overly restrictive rules.
As a student, I find prediction markets fascinating because they provide information you can't get anywhere else. Whether it's forecasting election outcomes or economic events, the prices often seem more accurate than polls or pundits. That kind of data isn't just useful for traders; it helps everyone make better decisions, from regular people to policymakers. Academic research backs this up, showing how these markets aggregate information efficiently. I think the CFTC should consider this public benefit when addressing questions like 7 and 8 in the ANPR about balancing innovation and consumer protection.
I also want to push back on the idea that event contracts are just gambling. Trading on these platforms takes research and judgment, much like investing in stocks. I use them to hedge personal risks, like potential policy changes that could affect my future career or student loans. Businesses can do the same for bigger risks, like regulatory shifts. This ties directly to questions 15 and 16 about defining gaming versus legitimate markets. These contracts serve real economic purposes, and labeling them as gaming feels like a misstep.
I'm worried that banning or over-restricting prediction markets would just push activity to unregulated offshore platforms. I've seen how platforms like Kalshi, which operate under CFTC oversight, offer transparency and safety. Offshore alternatives don't. On questions 29 to 32 about insider trading and informed traders, I think it's worth noting that informed trading often improves price discovery, benefiting everyone. Plus, the CFTC already has strong tools to tackle manipulation and insider trading. Use those instead of broad bans. Shutting down regulated markets punishes honest participants and cedes leadership in financial innovation to other countries.
The U.S. should be a leader in this space, not fall behind. I urge the CFTC to focus on targeted rules that address specific risks without stifling the benefits these markets bring. Let's keep prediction markets accessible, safe, and regulated right here at home.
Thank you for considering my input.
Sincerely,
Noah Javier
