Comment Text:
Dear Chairman and Commissioners,
My name is Luz Caballero, and I'm a small business owner from Texas. I run a local retail store here, and I've had the chance to use prediction markets a few times to get a sense of where things like economic policies or election outcomes might be headed. I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, published in the Federal Register as 91 FR 12516, because I believe these markets have real value and shouldn't be over-restricted or misunderstood as mere gambling.
As a business owner, I deal with uncertainty every day, whether it's about supply chain costs, tax changes, or new regulations that could hit my bottom line. Prediction markets have given me a unique tool to gauge what might happen, often with more accuracy than news pundits or polls. I've placed a few trades on platforms like these to hedge against outcomes that could affect my store, like potential tariff hikes or shifts in local policy after an election. This isn't about gambling for me. It's about making informed decisions with real money on the line, using research and judgment, just like I do when I invest in inventory or equipment.
I want to stress that event contracts serve a genuine economic purpose. They're not a game or a lottery. They're a way to aggregate information from lots of people, including those who might have specialized knowledge. On that point, I'm particularly interested in your questions 29 through 32 about inside information and informed trading. I believe that traders with better information actually improve price discovery for everyone, not just themselves. When someone who really knows a subject trades on a prediction market, the prices get sharper and more accurate. That benefits me as a user, even if I'm not the expert. Sure, insider trading by federal officials or others with nonpublic info is a concern, but that's already illegal. The CFTC has the authority to enforce those laws without banning entire markets. Punishing everyone for the actions of a few bad actors doesn't make sense to me.
I also worry that if these markets are over-regulated or shut down, the activity will just move to unregulated offshore platforms where there's no oversight at all. I'd much rather see the CFTC create clear, fair rules that keep prediction markets operating here in the U.S., under your watch. I'm asking you to support proportionate regulation that addresses specific risks like manipulation, without broad bans or labeling these contracts as gaming.
Thank you for considering my perspective as a small business owner who sees real value in these tools. I hope you'll craft rules that allow prediction markets to thrive while protecting participants.
Sincerely,
Luz Caballero
