Comment Text:
Dear Chairman and Commissioners,
My name is Brent Belt, and I'm a finance professional from Illinois writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I've worked in finance for years, and I've used prediction markets a few times myself, so I feel compelled to weigh in. While I understand the potential value of these markets, I strongly believe they should be banned outright due to the severe risks they pose, especially regarding insider information.
As someone who actively trades to capitalize on market inefficiencies, I see firsthand how uneven the playing field is in prediction markets. People with less information are essentially betting against participants who often have inside knowledge, whether they're government officials or others with access to confidential data. I've read too many stories of informed individuals profiting at the expense of regular traders, and this exploitation needs to stop. It's not fair, and it undermines any supposed benefits these platforms claim to offer. I don't buy the propaganda pushed by companies like Kalshi that these markets are just innovative tools for the public good. To me, theyre a setup for abuse.
I also worry about the broader implications. The United States should be a leader in financial innovation, no question. But leading doesn't mean allowing markets that can so easily be gamed by a few at the expense of many. If we let prediction markets like Kalshi and Polymarket continue, we're not leading; we're just opening the door for other countries to point at our lax rules and justify their own problematic systems. True leadership would be taking a hard stand against platforms that inherently favor insiders.
Regarding some of the specific questions in your ANPR, particularly those under Topic E on inside information (Questions 29-32), I believe the risk of insider trading isn't just a minor issue to be managed with rules. It's a fundamental flaw. No amount of regulation can fully prevent someone with nonpublic information from profiting unfairly, and the CFTC shouldn't waste resources trying to police something that's broken by design. A total ban is the only way to protect everyday participants.
I also want to touch on hedging, which falls under Topic B on public interest (Questions 7-14). While I understand the argument that prediction markets could help individuals or businesses hedge financial risks, I don't think the benefit outweighs the harm. There are other, safer ways to manage risk without creating a system where less-informed traders are almost guaranteed to lose.
In closing, I urge the CFTC to ban prediction markets entirely. Don't let the promise of innovation blind us to the reality of exploitation. Protect the integrity of our financial system and the people who participate in it by shutting these platforms down.
Sincerely,
Brent Belt
