Comment Text:
Dear Chairman and Commissioners,
My name is Matthew Austin, and I'm an everyday citizen from Ohio writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I'm new to prediction markets, but I've been following their growth with interest, and I strongly support their development under fair and proportionate regulation by the CFTC.
I believe prediction markets offer something unique: forecasts that are often more accurate than polls or pundits. I've seen how these markets have predicted election outcomes and other public events better than traditional sources, and that kind of insight is valuable to everyone, not just traders. It helps regular people like me make sense of a complicated world. Beyond that, academic research shows these markets aggregate information efficiently, and I think transparency in data like this benefits society as a whole.
I'm also convinced that regulated platforms, like Kalshi, are a much safer option compared to unregulated offshore sites. If the CFTC over-restricts or bans these markets, I worry it will just push activity to less safe places where theres no oversight. Instead, the US should lead in financial innovation. We shouldn't let other countries take the lead on something that could be a powerful tool for forecasting and risk management.
On the practical side, I see real value in how prediction markets let individuals and businesses hedge against uncertainty. Whether it's an election result affecting taxes or a policy change impacting a small business, these markets provide a way to manage risk. This isn't gambling. Event contracts serve legitimate economic purposes, and I don't think they should be classified as gaming. Trading here takes research and judgment, just like investing in stocks.
I know there are concerns about manipulation or insider trading, but the CFTC already has strong tools to address those issues in other markets. Those same tools can work here. Plus, informed trading often improves price discovery, which helps everyone. Banning or over-restricting these markets to stop a few bad actors would punish the rest of us who just want access to better information and ways to protect ourselves financially.
Id like to address a couple of specific questions from the ANPR. On Question 7 under Public Interest, I think the balance between innovation and consumer protection lies in targeted rules, not broad bans. And on Question 15 under Listed Activities, I urge the CFTC to avoid labeling event contracts as gaming when they clearly serve economic purposes like hedging and price discovery.
In closing, I ask the CFTC to support proportionate regulation of prediction markets. Please dont ban or overly restrict them. Focus on specific risks with targeted rules, and let these markets grow under your oversight. Thank you for considering my views.
Sincerely,
Matthew Austin
