Comment Text:
Dear Chairman and Commissioners,
My name is Lynn Shepodd, and I'm an everyday citizen from California writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've used prediction markets a few times myself, and I believe they have real value for people like me, as well as for society as a whole. I'm in favor of smart, obvious regulation that lets these markets operate legally while protecting consumers.
First off, I think prediction markets are a powerful tool. They provide better information for public decision-making by aggregating what people really think about future events, often more accurately than polls or pundits. I've seen this firsthand when I used a platform to gauge the likelihood of certain economic policies that could affect my personal finances. That kind of price discovery isn't just helpful for traders; its useful for everyone trying to make informed choices. Beyond that, these markets let individuals and businesses hedge real risks. Whether it's an election outcome impacting taxes or a policy shift affecting a small business, having a way to offset uncertainty is practical, not frivolous.
I also strongly believe the U.S. should lead in financial innovation. If we over-restrict or ban prediction markets, we're just pushing activity to unregulated offshore platforms where theres no oversight at all. I've read about platforms like Kalshi, which operate under CFTC rules, and that feels so much safer than the alternatives. Regulation done right keeps consumers protected while letting us participate in legal markets. I'm all for freedom to engage in these markets as long as there are clear rules.
Addressing some of your specific questions, like those in Topic Area B on public interest (Questions 7-14), I think the balance should tip toward innovation with targeted safeguards, not broad bans. And on Topic Area C regarding listed activities (Questions 15-22), I agree there should be limits. I don't support betting on military activities, war, or anything like that. Those areas feel inappropriate for trading. But for most other events, a proportionate approach makes more sense than categorical prohibitions.
I'm not naive about the risks. Theres always a chance of manipulation or insider trading, but the CFTC already has tools to handle that in other markets. Use those tools here too, rather than shutting down something valuable to many of us. Banning prediction markets to stop a few bad actors feels like punishing everyone for the actions of a few.
I urge you to support well-regulated prediction markets with clear, targeted rules that address specific concerns without overreaching. Lets keep the U.S. at the forefront of financial innovation and ensure citizens like me can participate safely.
Thank you for considering my input.
Sincerely,
Lynn Shepodd
