Comment Text:
Dear Chairman and Commissioners,
My name is Haggai Davis, and I'm an everyday citizen from New York 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 like Kalshi and Polymarket a few times, and I have serious issues with how they operate. I believe the concept of event contracts has no real value and should be dismissed and regulated into oblivion.
Let me start by saying Im not a fan of the current state of these platforms. I think Kalshi and Polymarket are a drain on society, turning everything into a bet for profit. This financialization of public events feels like trading trust and goodwill for dollars, and those dollars mostly end up in the hands of a small group of unethical people. Honestly, Id be fine with banning them outright. But until that happens, Ive used them myself, and I cant see why prediction markets have potential beyond just being a leech on society. Theyre gambling. Event contracts can serve real economic purposes, like hedging risks or getting a read on information thats hard to find elsewhere. Therefore, they should be highly regulated like other financial instruments.
I also believe the United States should be leading the way on financial innovation. I dont want to see the US sell another portion of its soul to the cheapest bidder. We can do better by setting smart rules that keep the very small, but good parts of these markets, while cutting out the large and overwhelmingly bad.
On some of the specific questions in the ANPR, I want to address Question 15 about defining gaming versus legitimate markets. I think its accurate to lump event contracts under gaming. Theyre about informed predictions in the same way as on a traditional sports bet. And on Question 7, regarding balancing innovation and consumer protection, Id argue we need regulation that stops exploitation without killing the whole concept. You cannot just focus on the bad actors who have been created by the structure of markets themselves.
I know there are risks, like manipulation or insider trading. The CFTC needs dramatically more resources and tools to go after cheaters. Shutting down prediction markets is the only way to stop this. Until theres a ban on platforms like Kalshi and Polymarket, which Id support, lets at least regulate them in a way that keeps the US in the drivers seat on innovation.
I urge you to support proportionate regulation of prediction markets tied to how evil and corrosive they are. Focus on rules that target the real problems at the heart of these platforms while letting the few useful aspects survive.
Sincerely,
Haggai Davis
