Comment Text:
Dear Chairman and Commissioners,
My name is Logan McKenna, and I'm a small business owner based in Massachusetts. Im writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. Ive used prediction markets a few times myself, and I strongly support their development under fair and proportionate regulation by the CFTC. I believe they offer unique value to people like me and to society as a whole.
As a business owner, Im always looking for reliable information to help me plan ahead, especially when it comes to major public events like elections that can impact taxes, regulations, or consumer behavior. Ive found prediction markets to be incredibly useful for this. Unlike polls or pundit opinions, which often seem swayed by bias or noise, the prices on these markets cut through the clutter. Theyve consistently been more accurate in forecasting outcomes, and thats information I can actually use to make decisions for my business. I remember checking a market last year before a big election, and its prediction was spot on when most news outlets got it wrong. That kind of insight isnt just helpful for traders; its valuable for anyone paying attention.
I also want to push back on the idea that event contracts are just gambling. To me, trading on these platforms takes real research and judgment, much like investing in stocks or commodities. Its about understanding the world, not rolling dice. These markets serve a real economic purpose, whether its helping someone like me gauge political risks or letting others hedge against uncertainty. Labeling them as gaming feels like a misstep when theyre clearly a tool for informed decision-making.
On a broader level, I think the US has a chance to lead the way in financial innovation here. Prediction markets are a cutting-edge idea, and if we over-restrict them, we risk pushing this technology and talent to other countries. Id hate to see the US fall behind on something with so much potential. Addressing some of the CFTCs specific questions, like those in the Public Interest section (Questions 7-14), I believe the balance should tilt toward fostering innovation while using existing tools to protect consumers. And on the topic of Listed Activities (Questions 15-22), I urge you to define event contracts based on their economic utility, not as gambling.
I understand there are concerns about manipulation or insider trading, but I dont think the answer is to ban or overly limit these markets. The CFTC already has strong rules and authority to tackle bad actors. Use those tools, dont punish the rest of us by shutting down something so useful.
I respectfully ask that the CFTC support proportionate regulation of prediction markets. Lets keep access open for regular people and businesses while addressing risks with targeted rules, not broad restrictions. Thank you for considering my perspective.
Sincerely,
Logan McKenna
