Bitwise Asset Management has filed with regulators to launch a new line of exchange-traded funds tied to political prediction markets, marking its latest push into alternative investment products.
Summary
- Bitwise has filed with regulators to launch a new line of ETFs focused on U.S. election outcomes.
- The proposed funds would give investors regulated access to political prediction contracts through traditional brokerage accounts.
- Approval is still pending, and regulators continue to review how these products fit within existing securities rules.
The filing was disclosed by Bloomberg ETF analyst James Seyffart, who shared details on social media. According to the preliminary prospectus dated Feb. 17, the proposed funds would operate under the “PredictionShares” brand and remain subject to regulatory approval.
The document states that the offering is incomplete and that the securities cannot be sold until the registration statement becomes effective.
Election-focused contracts at the core
The filings outline several proposed ETFs linked to U.S. political outcomes. These include separate funds tracking whether Democrats or Republicans win the 2028 presidential election, as well as products tied to control of the House and Senate in the 2026 mid-term elections.
Rather than investing in companies connected to prediction markets, the funds are designed to hold event-based contracts sourced from regulated trading venues. These contracts pay out based on specific real-world outcomes, such as election results.
Bitwise said PredictionShares will serve as a dedicated platform for clients seeking regulated exposure to prediction markets through traditional brokerage accounts. No launch date has been set, and approval from the U.S. Securities and Exchange Commission has not yet been granted.
Seyffart noted that similar filings have appeared in recent months and said more are likely to follow as interest in the sector grows.
Growing competition and market interest
Bitwise’s chief investment officer, Matt Hougan, said prediction markets are expanding in both size and relevance, making them difficult for asset managers to ignore. He added that client demand played a key role in the decision to pursue the products.
Other firms have also moved into the space. Roundhill Investments previously filed for similar election-based ETFs, while GraniteShares has submitted competing proposals. None has yet received regulatory clearance.
With platforms like Polymarket reporting heavy trading volume during significant political events, prediction markets have drawn increased attention in recent election cycles. Supporters say these markets often reflect public opinion more quickly than traditional polls.
Critics, like Vitalik Buterin, warn that they are extremely risky and can behave like speculative bets. Industry analysts caution that funds associated with particular outcomes could lose most of their value if forecasts prove to be wrong.
Additionally, regulators are examining how these products align with current derivatives and securities regulations.