Wall Street Moves Into Prediction Markets With Election-Contract ETF Filings
Institutional traders are coming into prediction markets, following a technique seen earlier within the crypto area.
Asset managers are submitting for prediction-market tied exchange-traded funds because the area continues to achieve traction.
Institutional Capital Moves Into Prediction Markets as ETF Race Begins
On February 17, 2026, Bitwise Asset Management submitted a post-effective modification to register six ETFs underneath a brand new model referred to as “PredictionShares.” The proposed funds, tied to occasion contracts on the result of US elections, can be listed and primarily traded on NYSE Arca.
“PredictionShares will function a brand new Bitwise platform targeted on offering publicity to prediction markets. Bitwise’s CIO Matt Hougan says prediction markets are accelerating in each scale and significance, making consumer publicity a chance the agency couldn’t move up,” Crypto In America host Eleanor Terrett wrote.
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 ETF seeks capital appreciation tied to a particular US election final result. It follows an 80% funding coverage underneath which it’ll make investments at the very least 80% of its internet belongings, plus any borrowings for funding functions, in by-product devices whose worth is linked to that outlined political occasion.
The funds acquire publicity primarily via swap agreements that reference CFTC-regulated occasion contracts listed on designated contract markets, though they might additionally make investments straight in these occasion contracts. The occasion contracts comply with a binary payout construction, sometimes settling at $1 if the desired final result happens and at $0 if it doesn’t.
“This makes an funding within the Fund extremely dangerous. An funding within the Fund isn’t acceptable for traders who don’t want to put money into a extremely dangerous funding product or who don’t absolutely perceive the Fund’s funding technique. Such traders are urged to not buy Fund Shares,” the filing reads.
Moreover, GraniteShares, an unbiased ETF issuer, additionally filed a Form 485APOS on February 17 for six related funds. These two filings adopted shortly after Roundhill made the identical transfer.
Bloomberg Intelligence Senior Research Analyst James Seyffart indicated that extra filings are prone to proceed.
“The financialization and ETF-ization of every part continues,” he added.
The ETF filings arrive because the prediction market sector posts record-breaking growth. The transfer mirrors the surge of ETF functions tied to digital assets, when asset managers rushed to capitalize on renewed momentum within the sector following the election of a pro-crypto administration.
While demand for Bitcoin and Ethereum ETFs appears to have slowed, evidenced by vital outflows from the spot merchandise, establishments could also be seeking to broaden their publicity to the rising prediction market area.
Data from Dune Analytics highlights the sector’s momentum. Monthly trading volume climbed to $15.4 billion in January, setting a brand new all-time high.
Transaction rely additionally reached a report, surpassing 122 million, whereas monthly users rose to 830,520. Taken collectively, these recommend sustained progress throughout the prediction market sector, alongside growing product improvement and institutional curiosity.
The submit Wall Street Moves Into Prediction Markets With Election-Contract ETF Filings appeared first on BeInCrypto.
