Comment Text:
Dear Chairman and Commissioners,
My name is James Hatcher, and I'm a trader and investor from Kentucky. I've been in the markets for years, mostly stocks and commodities, but I've also used prediction markets a few times to get a read on events that affect my portfolio. I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516) because I strongly support the freedom to participate in legal, regulated markets like these, and I want to share why I think the CFTC should regulate them fairly instead of banning or over-restricting them.
I've seen firsthand how prediction markets produce forecasts that are often more accurate than polls or pundits. When I'm trying to figure out how an election or a Fed decision might hit my investments, the prices on these platforms give me a clearer picture than any news outlet. That information isn't just useful for me, it's valuable for everyone. But here's the thing, if you over-restrict or shut these markets down, you're not stopping the activity. You're just pushing it to unregulated offshore platforms where there's no oversight. I've looked at some of those sites, and they're a mess compared to regulated markets like Kalshi. The CFTC keeping a strong hand on this keeps traders like me safer.
I also believe the US should be leading the way in financial innovation. We shouldn't be handing that over to other countries by making it too hard to operate here. Banning or heavily restricting prediction markets doesn't solve problems, it creates them. Prohibition of any market just doesn't work. People will find a way to trade, and it'll be in places where the CFTC can't touch them. Plus, I don't see event contracts as gaming. They serve a real economic purpose, like hedging or getting a read on risks. Calling them gambling feels like calling all investing gambling, which I'm sure you'd agree is off base.
Looking at some of the specific questions in the ANPR, I want to address a couple. On Question 8 under Public Interest, about balancing innovation and consumer protection, I think you can do both with proportionate rules, not broad bans. And on Question 15 under Listed Activities, about defining gaming, I urge you not to lump event contracts into that category. Theyre tools for price discovery and risk management, not slot machines. On Question 29 about inside information, sure, that's a risk, but it's already illegal, and the CFTC has tools to enforce against it without shutting everything down.
I'm asking you to support proportionate, targeted regulation of prediction markets. Don't let overblown fears lead to bans or rules so tight they push honest traders like me out of safe, regulated spaces. Keep the US at the forefront of this innovation, and keep these markets accessible to people who use them responsibly.
Sincerely,
James Hatcher
