Comment Text:
Dear Chairman and Commissioners,
My name is Malcolm Spivey, and I'm a trader and investor based in Georgia. I'm writing to express my support for the thoughtful regulation of prediction markets as outlined in the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I'm relatively new to these markets, but Ive quickly come to see their value, and I believe they deserve a fair regulatory framework that allows them to thrive while addressing real risks.
As someone who spends a lot of time analyzing markets and managing financial exposure, I find prediction markets to be a unique tool. They aren't just a novelty; they offer a way to hedge against real uncertainties that impact my personal finances and, frankly, my peace of mind. For instance, I've been looking at contracts tied to economic indicators like inflation data or Federal Reserve decisions. These outcomes directly affect my investment decisions, from timing trades to planning for interest rate shifts that hit my loans and savings. Being able to hedge against those risks, even in a small way, feels like a practical safety net. I believe this utility extends to businesses too, especially small ones here in Georgia that face uncertainty from policy changes or economic events outside their control.
I understand there are concerns about manipulation or insider trading, and those shouldn't be ignored. But I don't think the answer is to ban or overly restrict these markets. The CFTC already has strong tools to tackle fraud and manipulation in other derivatives markets, and I trust those can be adapted here. Shutting down prediction markets to stop a few bad actors would hurt people like me who are using them responsibly. It's worth noting that federal employees and officials are already barred from trading on nonpublic info. Enforcing existing laws makes more sense than broad prohibitions.
I'm particularly interested in your questions on hedging utility, like Question 10 under the Public Interest section, which asks how prediction markets can serve risk management. My answer is simple: they let regular folks and businesses offset very real financial risks tied to events we can't control. A farmer hedging against a policy shift, or someone like me managing exposure to rate hikes, shows these markets have economic purpose, not just speculative appeal.
I urge the CFTC to craft rules that support innovation and access while targeting specific abuses with focused oversight. Prediction markets are a powerful tool for democratizing information and managing risk. Please don't let overregulation cut off their potential before they can fully develop. Thank you for considering my perspective.
Sincerely,
Malcolm Spivey
