CFTC investigates Adam Kinzinger over Kalshi trades tied to his own pardon

The Commodity Futures Trading Commission is looking into prediction market trades made by former Congressman Adam Kinzinger on Kalshi, specifically contracts tied to whether he would receive a presidential pardon from Joe Biden. The trades occurred between December 2024 and January 2025, right before Biden issued a wave of preemptive pardons as he left office.

Kinzinger, a former Republican member of the House January 6 committee who retired from Congress in 2023, says he walked away with a grand total of $823 in profit. He also says he had no insider knowledge and reviewed Kalshi’s trading rules before placing his bets.

What Kinzinger actually traded

The investigation centers on contracts Kinzinger purchased on Kalshi’s prediction market platform. One contract was directly tied to whether he himself would receive a pardon. Another was a broader market on Biden issuing preemptive pardons generally.

During the relevant window, Kinzinger executed approximately 25 trades. Most of them lost money. The net $823 gain came from just a couple of winning positions.

Biden did ultimately grant preemptive pardons to multiple individuals connected to the January 6 committee and other political figures as his presidency wound down. Kinzinger was among the recipients. The timing of the trades, coming weeks before the pardons were officially announced, is what caught the CFTC’s attention.

Kinzinger has maintained that he followed Kalshi’s posted guidelines and had no special knowledge about whether a pardon was coming his way. Neither the CFTC nor Kalshi has contacted him directly as part of the probe, according to his account.

Why prediction market regulators are paying attention

Kalshi’s own rules prohibit participants from trading on contracts where they have influence over the outcome. The question the CFTC appears to be wrestling with is whether Kinzinger, as someone who could theoretically lobby for or be involved in discussions about his own pardon, had the kind of influence that should have disqualified him from trading on that contract.

The agency has previously taken enforcement action against other instances of self-interested trading on the platform. In earlier cases, the CFTC addressed situations where political candidates traded on their own races.

The CFTC also issued a broader Prediction Markets Advisory establishing that the Commodity Exchange Act’s prohibitions on trading with material nonpublic information apply to event contracts just as they do to traditional futures and derivatives.

Kalshi has reportedly been conducting its own compliance assessments and has flagged certain trading activities to the CFTC for review.

The bigger picture for prediction markets

A senator trading on a contract about whether a bill will pass, a CEO trading on whether their company will hit earnings targets, a pardon recipient trading on whether they’ll be pardoned. Each scenario sits at a different point on the spectrum between “informed participant” and “insider,” and regulators are still figuring out where to draw the line.

For Kalshi specifically, the investigation adds another layer of regulatory complexity to a business that already fought a protracted legal battle with the CFTC over its right to offer election contracts. The platform won that fight in court.

For now, the investigation remains in its early stages, with neither the CFTC nor Kalshi commenting publicly on the probe. Whether a profit of $823 on a handful of prediction market trades ultimately leads to formal enforcement action will say a lot about how aggressively regulators intend to police this rapidly growing sector.