Key Highlights
- Bitwise has joined Roundhill in filing for prediction market ETFs under the new “PredictionShares” platform.
- The proposed funds would track contracts tied to the 2026 U.S. midterms and the 2028 presidential election.
- Bitwise says growing interest in prediction markets drove the move, while the filings highlight the products’ high-risk, event-driven nature.
Bitwise Asset Management has filed a post-effective amendment with the U.S. Securities and Exchange Commission (SEC) to register a new group of exchange-traded funds (ETFs) tied to U.S. political election outcomes, marking its formal entry into prediction market-based investment products.
The filing introduces six proposed ETFs under a new brand, PredictionShares, which would offer investors exposure to contracts linked to the 2026 U.S. midterm elections and the 2028 presidential race. The amendment updates the registration statement for the Bitwise Funds Trust, a Delaware statutory trust and registered investment company.
The submission, filed as Form 485APOS, is a Post-Effective Amendment No. 46 under the Securities Act of 1933 and Amendment No. 48 under the Investment Company Act of 1940. It remains subject to completion and is scheduled to become effective 75 days after filing, meaning the funds are not yet available for sale.
Election outcomes as investment vehicles
According to the filing, the proposed ETFs are designed to deliver capital appreciation based on specific political outcomes, using binary event contracts and derivatives traded on CFTC-regulated designated contract markets. These contracts typically settle at one dollar if the predicted outcome occurs and zero if it does not.
The six proposed funds are:
- PredictionShares Democratic President Wins 2028 Election
- PredictionShares Republican President Wins 2028 Election
- PredictionShares Democrats Win Senate 2026 Election
- PredictionShares Republicans Win Senate 2026 Election
- PredictionShares Democrats Win House 2026 Election
- PredictionShares Republicans Win House 2026 Election
Each fund is built around a single political result, whether that is control of Congress or the White House, with final settlement tied to formally defined events such as the seating of a new Congress or the inauguration of the next president.
Structure and strategy
According to the filing, at least 80% of each fund’s assets would be allocated to event contracts, swaps, or similar derivatives linked to the targeted election outcome. Any remaining assets would be parked in short-term U.S. Treasuries, money market instruments, or reverse repurchase agreements to satisfy collateral needs and regulatory requirements.
The funds would be actively managed, with portfolio managers closely tracking polls, election-related developments, regulatory signals, and market pricing. The value of the contracts is expected to mirror implied probabilities, meaning a contract trading at around fifty cents would suggest the market is pricing in roughly a 50% chance of that outcome occurring.
Following the election settlement, the funds would liquidate their positions, distribute remaining assets to shareholders, and terminate operations.
Platform expansion
Journalist Eleanor Terrett reported that Bitwise Asset Management has joined Roundhill Investments in filing for prediction market ETFs tied to U.S. elections.
The proposed funds would track contracts linked to the 2028 presidential race and upcoming House and Senate midterms, with PredictionShares positioned as a new Bitwise platform for exposure to prediction markets, a move that Bitwise Chief Investment Officer Matt Hougan said reflects growing interest in the sector as it expands in both scale and importance.
Industry analyst James Seyffart characterized the filings as part of a broader trend in financial markets. “The financialization and ETF-ization of everything continues. This is not the first filing of this kind and I think it’s extremely unlikely that these will be the last.”
PredictionShares will operate as a distinct platform within Bitwise’s broader ETF lineup, which also includes digital asset and cryptocurrency-linked strategies in separate filings.
Administration and listing
The Bitwise Funds Trust is advised by Bitwise Investment Manager, LLC, based in San Francisco. Distribution would be handled by Foreside Fund Services, while fund administration and custody services would be provided by The Bank of New York Mellon. The funds are expected to trade on NYSE Arca, subject to approval.
The filing also notes that Bitwise may employ wholly owned Cayman Islands subsidiaries for certain strategies to maintain regulated investment company tax status, with subsidiary assets capped at 25% of fund assets on a quarterly basis.
High-risk profile highlighted
The prospectus makes it clear that these products are highly speculative, cautioning that investors stand to lose nearly all of their capital if the anticipated political outcome fails to materialize.
It also flags a range of structural and market risks, including the possibility of regulatory action against political event contracts, limited liquidity, pricing and valuation difficulties, counterparty exposure, and potential trading interruptions.
Because the funds are newly proposed, they do not yet have an operating history, published performance data, or finalized expense figures.
Regulatory context
While Bitwise has existing products tied to cryptocurrencies and digital asset markets, the firm makes clear that these proposed ETFs are not related to spot Bitcoin or Ether exposure. Instead, they represent a regulated, exchange-traded approach to prediction markets, a sector that has drawn increasing attention from regulators and institutional investors alike.
The filing positions Bitwise among a growing group of asset managers seeking to bring event-driven and political outcome-based strategies into traditional ETF wrappers ahead of the 2026 and 2028 election cycles.
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