Bet on Elections: Bitwise Launches High-Risk PredictionShares ETFs for 2026 & 2028

Bitwise Joins Roundhill With “PredictionShares” Election ETF Filing

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 officially entered the world of investment products based on predicting election outcomes. They recently filed paperwork with the Securities and Exchange Commission (SEC) to register a new set of exchange-traded funds that will allow investors to potentially profit from U.S. political elections.

A new filing details plans for six exchange-traded funds (ETFs) under the name PredictionShares. These ETFs would allow investors to potentially profit from the outcomes of the 2026 U.S. midterm elections and the 2028 presidential election. The filing updates paperwork for the Bitwise Funds Trust, a registered investment company based in Delaware.

This document, submitted as Form 485APOS, updates previous filings related to securities and investment regulations. It’s still being finalized and won’t be effective for about 75 days, so the related funds aren’t currently available for purchase.

Election Outcomes as Investment Vehicles

As an analyst, I’ve been reviewing the details of these proposed ETFs, and essentially they’re built to potentially profit from correctly predicting political events. They’ll use financial contracts – specifically binary event contracts and derivatives traded on regulated markets – that pay out either $1 or $0 depending on whether the event happens as predicted. The goal is capital appreciation based on these outcomes.

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

These funds are designed around specific political outcomes – like which party controls Congress or the presidency. Payouts depend on clear, official events, such as when a new Congress is sworn in or the next president takes office.

Structure and Strategy

The documents show that each fund would invest at least 80% of its money in financial contracts tied to the results of a specific election. The rest of the funds would be held in very safe, short-term investments like U.S. Treasury bills to meet legal and financial obligations.

The investment strategy involves actively monitoring political polls, election news, regulatory changes, and how the market is reacting. The price of each investment will reflect the perceived likelihood of an event happening – for example, an investment priced at 50 cents suggests a roughly 50% chance of that event occurring.

After the election is finalized, the funds will sell their investments, give any remaining money to shareholders, and then close down.

Platform Expansion

According to journalist Eleanor Terrett, Bitwise Asset Management has partnered with Roundhill Investments to apply for exchange-traded funds (ETFs) that allow investors to bet on the outcomes of U.S. elections.

The investment funds will follow contracts related to the 2028 presidential election and future House and Senate midterm elections. PredictionShares will be a new platform from Bitwise, offering investors a way to participate in prediction markets. According to Bitwise’s Chief Investment Officer, Matt Hougan, this move highlights the increasing popularity and significance of this growing market.

As a researcher following the markets, I’ve noticed a pattern, and these filings definitely fit into it. According to industry analyst James Seyffart, they’re not isolated incidents, but rather part of a larger trend we’re seeing across the financial landscape.

We’re seeing a growing trend of turning everything into financial products, especially through exchange-traded funds (ETFs). This isn’t a new development, and it’s likely we’ll see many more similar instances in the future.

PredictionShares will function as its own platform, but it will be part of Bitwise’s existing group of investment funds, which already cover digital assets and cryptocurrencies. These other funds are managed separately.

Administration and Listing

Bitwise Funds Trust is managed by Bitwise Investment Manager, a San Francisco-based company. Foreside Fund Services will handle distribution, and The Bank of New York Mellon will provide fund administration and safekeeping of assets. These funds are planned to be listed on NYSE Arca, pending regulatory approval.

Bitwise might use its subsidiaries in the Cayman Islands for some investment strategies to help it qualify for a special tax status for regulated investment companies. However, the assets held by these subsidiaries will be limited to no more than 25% of the fund’s total assets each quarter.

High-Risk Profile Highlighted

The document warns that these investments are very risky, and investors could lose almost everything if expected political changes don’t happen.

In my research, I’ve identified several potential risks associated with these markets. These include the possibility of regulators stepping in regarding contracts tied to political events, challenges with getting trades executed quickly due to limited liquidity, difficulties in accurately pricing and valuing these contracts, the risk of dealing with unreliable counterparties, and the potential for disruptions to trading.

Since these funds are brand new, there’s no track record of how they’ve performed, and details about their costs and returns aren’t available yet.

Regulatory Context

Bitwise already offers crypto and digital asset products, but these new ETFs are different. They won’t directly track the price of Bitcoin or Ether. Instead, they’re a way to trade predictions on the future of these markets, and this type of trading is gaining interest from both regulators and larger investors.

Bitwise is joining a number of investment firms looking to offer ETFs that profit from specific events and political results, particularly leading up to the 2026 and 2028 elections.

2026-02-18 06:54