Comment Text:
Dear Chairman and Commissioners,
My name is Andrew Morrissette, and I'm a finance professional from South Carolina. I'm writing in response to the Advance Notice of Proposed Rulemaking on Prediction Markets, as published in 91 FR 12516. I'm relatively new to prediction markets, but I strongly support their role in our financial system and believe they should be regulated in a fair, proportionate way rather than banned or overly restricted.
As someone who works in finance, I value accurate information above all else. Prediction markets have consistently proven to be more reliable than polls or pundits when it comes to forecasting elections and other public events. I've seen how the aggregated wisdom of these markets often cuts through the noise of biased commentary or flawed surveys. This isn't just useful for traders like me; it's valuable for the public, policymakers, and anyone who needs a clearer picture of what's likely to happen. I also believe that allowing everyday people to participate in these legal, regulated markets is a form of freedom we shouldn't take away. Democratizing access to this kind of financial tool ensures that the insights don't just stay with big institutions.
That said, I understand the concerns about insider trading or manipulation, and I've had my own frustrating experience with a platform. I placed a bet on Kalshi, and they delayed my payout while also paying out less than I expected due to what I see as a failure to follow their own rules. This kind of issue points to a need for better oversight and accountability for platforms like Kalshi, not just on insider trading but on protecting clients. Still, the answer isn't to shut down prediction markets. Banning or over-restricting them would just push activity to unregulated offshore platforms, which are far riskier for everyone. Instead, we need targeted rules to address these problems. I also think informed trading, when it's legal, actually improves price discovery and benefits all participants by making the market's predictions sharper.
I'm particularly interested in your questions 7 and 29 from the ANPR, on balancing innovation with consumer protection and whether informed traders help price discovery. I believe the CFTC can strike a balance by using its existing tools to prevent manipulation while allowing these markets to grow. Let's not punish the many for the actions of a few bad actors.
I urge you to support well-regulated prediction markets that allow participation while addressing specific risks with focused oversight. Don't let heavy-handed restrictions or outright bans stifle this valuable tool.
Sincerely,
Andrew Morrissette
