Comment Text:
Dear Chairman and Commissioners,
My name is Henrie Notley, and I'm a student in California. I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I care deeply about freedom and access to reliable information, and I believe regulated prediction markets are a powerful tool for both. I've used prediction markets a few times myself, and I see their value not just for traders but for society as a whole, especially for students like me who rely on accurate data for research.
I strongly support well-regulated prediction markets because they provide information you can't get anywhere else. They've consistently outperformed polls and pundits in forecasting elections and public events. That accuracy helps everyone, from policymakers to regular citizens, make better decisions. As a student studying economics and global issues, I often turn to this data for my research. Prediction market prices give me a clearer picture of near-future outcomes than any news report or survey. It's not just about trading; it's about having a reliable source of truth when so much else is noise.
I also believe event contracts aren't gambling. They're based on research and judgment, much like trading stocks. In fact, I'd argue stock trading feels riskier since a stock's value depends on someone wanting to buy it, while prediction market outcomes are tied to real-world events. These markets serve legitimate purposes, like price discovery and hedging, and shouldn't be lumped in with gaming. On top of that, allowing everyday people like me to participate democratizes access to financial tools. If only big institutions can trade, the best information stays with them. That's not fair, and it makes prices less accurate.
I'm aware of concerns like insider trading or manipulation, but the CFTC already has strong tools to address these issues. Those laws apply to all regulated markets, including prediction markets. Banning or over-restricting these platforms doesn't solve the problem; it just pushes activity to unregulated offshore sites, which are far less safe. Look at platforms like Kalshi, operating under CFTC oversight. That's the model we need more of. The US should be leading in financial innovation, not handing the advantage to other countries.
I want to address a couple of specific questions from the ANPR. On Question 7, regarding public interest, I believe prediction markets clearly benefit the public through better forecasting and decision-making data. On Question 29, about inside information, I think informed trading actually improves price discovery, as long as existing laws against insider trading are enforced. And on Question 15, about defining gaming, I urge you to recognize that event contracts have real economic value and shouldn't be treated as gambling.
Regulated prediction markets are one of the great financial innovations of our time. I ask the CFTC to support proportionate, targeted rules that address specific risks without broad bans. Let's keep this tool accessible and safe for everyone.
Sincerely,
Henrie Notley
