Bitwise Asset Management has filed with the U.S. Securities and Exchange Commission to launch prediction market backed exchange traded funds under a new brand called PredictionShares. The proposed funds would give regular investors a way to access political event contracts through normal brokerage accounts instead of using crypto prediction platforms.
How the PredictionShares ETFs Would Work
Bitwise plans an initial lineup of six ETFs that each track a specific U.S. political outcome. Two funds focus on who wins the 2028 U.S. presidential election, one tied to a Democratic victory and another to a Republican win.
Four more funds would track which party controls the House and Senate after the 2026 midterm elections, splitting exposure between Democrats and Republicans for each chamber. Instead of holding stocks or bonds, each ETF would invest at least 80% of its assets in binary event contracts listed on CFTC regulated exchanges.
These contracts typically settle at 1 dollar if the event happens and 0 dollars if it does not, so the ETF’s value rises or falls with the perceived odds of its outcome. Bitwise says the price of each fund’s shares should roughly track the market’s implied probability for that political result.
Why Bitwise Is Entering Prediction Markets
Bitwise chief investment officer Matt Hougan says prediction markets have grown in size and relevance, especially around high profile elections. He argues that many clients want regulated access to these markets but cannot or will not trade directly on platforms like Polymarket or Kalshi.
By wrapping event contracts in ETFs, Bitwise hopes to make this exposure available through familiar brokerage accounts and retirement platforms. The firm joins other issuers, including Roundhill Investments and GraniteShares, that have filed similar products as trading volumes in political contracts reach new highs.
The filing is still preliminary, and the SEC has not approved any of the PredictionShares funds. The prospectus warns that a fund tied to one party could lose almost all its value if that party loses the election.
Regulators also continue to debate where event contracts sit between derivatives, securities, and gambling products, especially when they involve political outcomes. The CFTC has previously tried to limit some election markets as “gaming,” while a U.S. court ruling in favor of Kalshi created room but not full clarity for political contracts.
READ MORE: Serenity Unveils Gold Tokenization Framework for Institutions
