Comment Text:
Dear Chairman and Commissioners,
My name is Justin Heinzekehr, and I’m a trader and investor from Indiana. I’ve been actively trading on prediction markets like Kalshi for about a year, and I also teach an undergraduate politics class. I’m writing to express my strong support for the proportionate regulation of prediction markets in response to the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). I believe these markets provide unique value to individuals like me and to society as a whole, and I urge the CFTC to craft rules that foster innovation while addressing specific risks.
As someone who follows the news closely to inform both my trading and my teaching, I often struggle to separate hype from meaningful information. Kalshi has been a game-changer for me in this regard. The market prices give me a clearer picture of what people actually think about current and near-future events—whether it’s an election outcome or a major policy shift. I use this to contextualize news for my students, helping them understand whether a story has genuinely “moved the needle” in public perception. I’ve even started using prediction markets to gauge sentiment on entertainment and sports news. While I know these markets aren’t perfect predictors, they consistently provide more accurate forecasts than polls or pundits, aggregating collective wisdom in a way nothing else does.
I believe this forecasting value benefits not just traders like me but also the public, media, and even policymakers who need reliable data for decision-making. In addressing Questions 7 and 8 from the ANPR on public interest and price discovery, I strongly argue that prediction markets serve a critical role in improving information transparency. Academic research, which I often discuss with my students, supports this—studies by economists like Hanson and Wolfers show these markets outperform traditional forecasting methods.
I’m aware of concerns about manipulation or insider trading, as raised in Questions 29-32. However, I believe the CFTC already has robust tools to address these risks. Existing laws prohibit federal employees from trading on nonpublic information, and the CFTC’s authority to combat market manipulation applies to prediction markets just as it does to other derivatives. Banning or over-restricting these markets to prevent bad actors punishes honest participants like me and pushes activity to unregulated offshore platforms, which are far riskier.
Regarding Question 15 on defining legitimate markets versus gaming, I urge the CFTC to recognize that prediction markets are not gambling—they require research and judgment, much like stock or commodity trading. As for Questions 23-28 on procedural aspects, I support a proportionate, targeted approach to regulation over broad categorical bans. Address specific risks with specific rules, rather than stifling an innovative tool that democratizes access to valuable information.
I respectfully ask the CFTC to support the growth of well-regulated prediction markets. They are a powerful resource for accurate forecasting and better decision-making, and with the right oversight, their benefits can be realized without undue risk.
Sincerely,
Justin Heinzekehr
