Comment Text:
Dear Chairman and Commissioners,
My name is Kevin Spicer, and I'm a student from Illinois with a strong interest in economics and financial markets. I've been actively trading on prediction markets like Kalshi and Polymarket for a while now, and I wanted to share my perspective on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I support well-regulated prediction markets and believe they provide real value to individuals like me, as well as society at large.
As a student, I find prediction markets to be an incredible tool for learning about the world. They aren't just a way to make a few bucks; they aggregate information in a way that no poll or pundit can match. I've used them to hedge personal risks, like betting on economic indicators that could impact my student loan payments or future job prospects. This isn't gambling. It takes research and judgment, just like investing in stocks. Labeling event contracts as "gaming" feels like a misstep when they serve real economic purposes, from hedging to price discovery.
I'm also drawn to the academic side of this. Prediction markets generate transparent data that researchers like me can study to understand public sentiment and forecast accuracy. But here's the thing: regulated platforms like Kalshi, under CFTC oversight, are far safer and more reliable than unregulated offshore sites. If the CFTC over-restricts or bans these markets, activity will just move to less safe venues. I've seen firsthand how offshore platforms lack the protections and transparency of regulated ones. The US should be leading in financial innovation, not pushing it away.
I know there are concerns about manipulation or insider trading, and I get that. But the CFTC already has strong tools to tackle those issues in other derivatives markets. Why not adapt those instead of broad bans? Informed trading actually improves price discovery, benefiting everyone, not just traders. This ties into Questions 29-32 from the ANPR about inside information. I think the focus should be on enforcing existing laws, not punishing all participants for the actions of a few.
On Questions 7-14 about public interest, I believe prediction markets balance innovation and protection when regulated proportionately. They help regular people and businesses hedge real risks, whether it's a policy change or an economic event. Banning categories of contracts, as discussed in Questions 15-22, feels like overreach when targeted rules could address specific problems.
I urge the CFTC to support proportionate regulation of prediction markets. Don't ban or overly restrict them. Keep the US at the forefront of financial innovation and ensure safe, legal access for people like me who value these tools for learning, hedging, and engaging with the world.
Sincerely,
Kevin Spicer
