Comment Text:
Dear Chairman and Commissioners,
My name is Allan Rubin, and I'm a student based in New York with a strong interest in academic research and data transparency. I'm writing to comment on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I support the development of well-regulated prediction markets in the United States, and I hope the CFTC will create a framework that encourages innovation while addressing valid concerns.
As someone studying data and research methods, I've come to see prediction markets as a powerful tool for aggregating information and forecasting outcomes. I've used platforms like Kalshi a few times to explore how these markets work, and I was struck by how they often provide insights that polls or expert opinions miss. For me, and for many in academic circles, this isn't just about trading; it's about accessing unique data that can inform research and public understanding of complex events. The prices in these markets reflect collective knowledge in a way that's hard to replicate elsewhere.
What concerns me most is the risk of pushing this activity into unregulated spaces. I strongly believe that regulated markets, like Kalshi operating under CFTC oversight as a designated contract market, are far safer for participants than offshore platforms with no accountability. If the CFTC imposes overly strict rules or bans certain types of event contracts, I worry that users like me, and many others, will turn to less transparent venues where consumer protections are nonexistent. Regulation should aim to keep this activity in a controlled, visible space, not drive it underground.
I'd like to address a couple of specific questions from the ANPR that relate to my perspective. On Question 7, regarding balancing innovation and consumer protection, I think the CFTC should prioritize rules that foster transparency and prevent manipulation without stifling the growth of these markets. And on Question 29, about the role of informed traders in price discovery, I believe that allowing a wide range of participants, even those with specialized knowledge, improves the accuracy of market prices, which benefits everyone, including researchers like me who rely on this data.
I understand there are legitimate worries about insider trading or market manipulation. But those issues are already addressed by existing laws and CFTC authority. Banning or over-restricting prediction markets punishes honest users and researchers while doing little to stop bad actors who'll just move to unregulated platforms anyway. The better approach is targeted oversight that uses the tools you already have.
In closing, I urge the CFTC to support proportionate regulation of prediction markets. Keep them accessible, transparent, and under your supervision, rather than pushing activity out of reach. Thank you for considering my input.
Sincerely,
Allan Rubin
