Comment on CFTC-2026-0331, CFTC-2026-0331-0001, Palmer, Schoening

QComment for Proposed Rule 91 FR 12516 April 29, 2026 Michael S. Selig Chairman Commodity Futures Trading Commission Three Lafayette Centre 1155 21st Street, NW Washington, DC 20581 Dear Chairman Selig: Family-owned businesses and other local establishments are America s main economic engine, providing jobs and preserving the character and neighborhoods and communities. Now, however, these vitally important symbols of American progress could be under threat from a pernicious source: so-called prediction markets. As prediction markets rapidly grow, they are normalizing sports betting which could redirect household spending away from family-owned and local businesses and into speculative wagering platforms. In evaluating the cost-benefit considerations related to prediction markets, the Commodity Futures Trading Commission should examine the downstream impact on family-owned and local businesses, along with community economic health. As it stands, money is flowing in all directions for prediction markets, which are essentially unsafe and unregulated sports betting sites masquerading as investment. In 2025 alone, Polymarket raised $2.2 billion and Kalshi raised $1.5 billion. These funds are fueling marketing that is enticing American to throw away enormous sums of money. Nearly $64 billion was spent on prediction market platforms in 2025. Much of this went toward sports event contracts, which in practice are indistinguishable from sports betting. However, prediction markets are not exposed to the state gambling taxes that licensed sportsbooks pay into and that fund important community programs across the country. Globally, prediction market trading volume increased by more than 400% between 2024 and 2025, with sports event contracts accounting for more than 80% of prediction market trading activity. For the most recent Super Bowl in February, prediction markets set a single-day record with more than $1 billion in trading volume. As prediction markets continue to evolve, they are constituting an ever-growing part of household spending. And the more money Americans spend on the risky gambling ventures of sports event contracts, the less that will be available for something far more vital: Supporting the family-owned and small businesses that are the nation s lifeblood. Spending their hard-earned money on those businesses is one of America s great traditions. The numbers are stark: research shows that America s family-owned businesses contribute $7.7 trillion annually to U.S. gross national product, accounting for 83.3 million jobs. As for local business broadly, American shoppers spent an estimated $3.7 trillion at local stores in 2024, or 51.3% of all retail sales, according to Capitol One. Showing how important local businesses are to our nation, 80% of people shop locally to support their community, while nearly all consumers report going online to find local businesses. It would be a shame for those well-deserved dollars to instead go into the pockets of the owners of prediction markets. The CFTC needs to take that into consideration in its approach to rulemaking, particularly around sports event contracts. Thank you, Palmer Schoening, Family Business Coalition