Comment Text:
Dear Chairman and Commissioners,
My name is Martin Cruz, and I'm just a regular citizen from Arizona 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 and for society as a whole. I'm asking you to support proportionate regulation of these markets rather than banning or overly restricting them.
I first got interested in prediction markets because I wanted better information about events that affect my life, like elections or economic shifts. The data from these markets often seems more reliable than what I hear from pundits or see in polls. I've read about academic studies showing how prediction markets aggregate information efficiently, often outperforming traditional forecasts. That kind of transparency and accuracy isn't just helpful for traders; it's useful for everyone, from regular folks making decisions to policymakers trying to understand public sentiment. I think the CFTC should recognize this public benefit when considering regulations.
One thing that worries me is the idea of banning or over-restricting these markets. I've seen platforms like Kalshi, which operate under CFTC oversight, and they feel much safer and more transparent than the unregulated offshore sites out there. If the rules become too tight, Im concerned people will just turn to those less safe options instead. Regulation should keep activity in the U.S., under your watch, where it can be monitored and protected. Pushing it offshore helps no one.
I also want to address the notion that event contracts are just "gaming." I don't see it that way at all. When Ive traded on prediction markets, it required research and judgment, much like any other investment. These contracts serve real economic purposes, like price discovery and even hedging against uncertainty. Classifying them as gaming feels like a misstep to me, and I hope the CFTC will consider their legitimate value instead.
Looking at some of the specific questions in the ANPR, I think my views tie into Questions 7 and 8 under the Public Interest section, about balancing innovation with consumer protection. I believe well-regulated markets strike that balance by keeping innovation alive while ensuring safety. Also, Question 15 on defining gaming versus legitimate markets is critical; I urge you to focus on the economic utility of these contracts rather than labeling them as something they're not.
In closing, I support prediction markets as a tool for better information and decision-making. Please craft rules that allow them to operate under fair oversight without driving activity to unregulated spaces. Thank you for considering my perspective.
Sincerely,
Martin Cruz
