Comment Text:
Dear Chairman and Commissioners,
My name is Gus Mahler, and I'm a student based in New York. I'm writing to express my support for well-regulated prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). As someone studying public policy and economics, I've come to see these markets as valuable tools for generating information and fostering civic engagement. I've even used them a few times myself to follow election forecasts and other public events.
I believe prediction markets offer unique benefits that aren't available through traditional polls or expert opinions. They aggregate real-time insights from a wide range of participants, often producing more accurate forecasts for things like elections or policy outcomes. This isn't just helpful for traders; it provides better data for everyone, from journalists to policymakers. I remember checking a prediction market during the last election cycle and finding its probabilities more reliable than the fluctuating news polls. That kind of price discovery is a public good, and I think the CFTC should encourage it through sensible regulation.
I'm also a strong believer in the freedom to participate in legal, regulated markets. As a student, I don't have the resources of big institutions, but prediction markets give me a chance to engage with real-world events in a meaningful way. Banning or overly restricting these markets would shut out regular people like me, while likely pushing activity to unregulated offshore platforms. That's not a solution. Instead, I urge the CFTC to focus on proportionate, targeted rules that address specific risks without broad categorical bans.
Regarding some of the specific questions in the ANPR, I want to address Question 11 under Public Interest, about balancing innovation and consumer protection. I think regulation should prioritize both by setting clear rules against manipulation and insider trading, while still allowing markets to operate. On Question 29 under Inside Information, I believe informed trading often improves price discovery. When people with knowledge participate, the market prices become more accurate, benefiting everyone. The CFTC already has tools to tackle illegal insider trading, so the focus should be on enforcing those existing laws, not restricting entire markets.
I understand there are concerns about manipulation or misuse, and those shouldn't be ignored. But shutting down prediction markets to stop a few bad actors feels like overreach. It's like closing a library because someone might steal a book. The answer is better security, not a ban.
In closing, I ask the CFTC to support the growth of prediction markets with fair, targeted regulations that protect participants without stifling innovation. These markets are too valuable for public decision-making and accurate forecasting to be overly restricted. Thank you for considering my perspective.
Sincerely,
Gus Mahler
