CFTC Places Regulatory Approval For Several ETFs on Temporary Hold
Mike Goodpaster Published 06/05/2026
Stating that they are seeking more information from the issuers, the federal Commodities Futures Trading Commission (CFTC) has placed more than two dozen exchange-traded funds (ETFs) from three new entrants into prediction markets on temporary regulatory hold. The issuers of these ETFs include Roundhill, Bitwise, and GraniteShares. All three companies are anxious to enter the burgeoning prediction market industry in the U.S.
The ETFs that are still awaiting regulatory clearance were originally filed in February. The Securities Exchange Commission (SEC) is seeking clarity on the mechanics and investor disclosures connected to these ETFs before approval will be granted.
The ETFs were expected to launch this week
The CFTC placed the expected launch of the ETFs from these three companies on hold. The decision to hold the launch was made after the SEC informed the CFTC that it was seeking more information on how the ETFs would work.
Under SEC regulations, ETFs generally become automatically effective within 75 days of their filing. That 75-day holding period was set to expire this week. However, indications from industry insiders were suggesting that the hold would only be a temporary measure.
Bitwise, GraniteShares, and Roundhill are all new entries into the fast-growing prediction market business. Each company is looking to capitalize on the burgeoning popularity of exchange-traded funds. The issue appears to be with the type of ETFs that the three companies are seeking to offer to traders. These specific ETFs make connections to real-world events such as elections, recessions, and tech layoffs. The concern about these types of markets is the likelihood that they could be easily manipulated via insider trading.
These new prediction market companies aren't concerned by the delay
A spokesperson for one of the three affected companies didn't express any concern about the delay. They are chalking it up to the newness and the rapid expansion of the prediction market landscape.
"It's an area that is maturing rapidly, and regulations and oversight are maturing rapidly as well," Matt Hougan, chief investment officer at Bitwise, told Reuters.
This emerging form of trading on actual world events blossomed in 2024 when industry pioneers Kalshi and Polymarket both correctly forecast Donald Trump's win in the 2024 U.S. Presidential election. Legal and regulated sports betting sites in the U.S. market protested that this was nothing more than illegal gambling in disguise. However, Trump's administration decided to allow the CFTC to regulate the prediction market industry, rather than ban it.
With so many new sites entering the prediction market game, these newer sites are seeking out methods to differentiate their product from their more established competitors.
"Everyone in the ETF market is looking for something that's new or different they can bring to the table, and this is just the latest example," said Dave Nadig, director of research at ETF Trends. The ETFs tend to be attractive to players because they are easier to trade than event contracts.
Insider trading is a significant concern in the prediction market industry
The debate over insider trading is the hot-button issue in the prediction market industry. Suspiciously well-placed wagers on U.S. military incursions in Venezuela and Iran, as well as good timing on changes in the price of crude oil, are helping to fuel these concerns.
Many of the ETF proposals from these three new firms revolve around the 2026 midterms and the 2028 U.S. Presidential election. There are also proposlas for ETF markets covering the price of crude oil and whether the U.S. economy will be falling into a recession.