Comment Text:
Dear Chairman and Commissioners,
My name is William Gieng, and I'm a software engineer based in Washington state. I'm writing to comment 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 strongly support their development under thoughtful, proportionate regulation by the CFTC. I believe these markets provide unique value to individuals like me, to businesses, and to society as a whole through better information and risk management.
As someone in the tech industry, I often deal with uncertainty around public events, whether it's an election outcome that could shift tax policies or a regulatory change that might impact my work. Prediction markets have given me a way to hedge some of that uncertainty and make more informed decisions. Beyond my personal use, I see how these markets aggregate information in ways polls and pundits just can't match. The prices reflect real-time, crowd-sourced insight, which helps everyone, not just traders. I've read academic studies, like those by economists such as Justin Wolfers, showing how prediction markets consistently outperform traditional forecasting methods. That kind of data transparency and price discovery is a public good.
I also want to stress that event contracts aren't gambling. They serve real economic purposes, like hedging risks or discovering information. Classifying them as "gaming" (as raised in Questions 15-22 of the ANPR) ignores their legitimate value. Trading on these platforms requires research and judgment, much like investing in stocks or futures. And for me, having access to regulated markets like Kalshi, under CFTC oversight, is far safer than the alternative of unregulated offshore platforms. Banning or over-restricting these markets (as discussed in Questions 7-14 on public interest) would just push activity to less secure venues, which helps no one. Consumer protection comes from regulation, not prohibition.
On the topic of manipulation and insider trading (Questions 29-32), I believe the CFTC already has strong tools to address these risks. They're illegal in any regulated market, and informed trading often improves price discovery, benefiting all participants. The answer isn't to ban prediction markets but to enforce existing laws. Plus, as a tech professional, I see the US needing to lead in financial innovation. If we over-regulate or shut down these markets, we risk ceding ground to other countries that embrace this technology.
I urge the CFTC to regulate prediction markets in a balanced way that addresses specific risks without broad prohibitions. Support innovation, protect consumers through oversight, and keep the US competitive. Thank you for considering my perspective.
Sincerely,
William Gieng
