Recession in 2025? Crypto Bettors Spike Odds After Trump’s Surprise Tariff Shock

Recession in 2025? Crypto Bettors Spike Odds After Trump’s Surprise Tariff Shock

As markets reel from President Donald Trump’s latest “Liberation Day” tariff announcement, the fear of an impending U.S. recession is no longer limited to economists and Wall Street strategists—crypto bettors are now actively pricing in the risk. In fact, odds on the blockchain-based prediction market Polymarket have jumped to over 54%, reflecting growing anxiety about America’s economic future.

What Triggered the Spike?

The catalyst? Trump’s sweeping tariff rollout, which includes a blanket 10% tariff on all imports, effective April 5. Dubbed “Liberation Day,” the announcement came as a shock to markets already treading carefully in an election year. While Trump’s base may view it as a move to protect American industry, financial markets and prediction markets alike see it as a potential trigger for economic contraction.

In the hours following the announcement, Polymarket’s contract titled “US recession in 2025?” surged in popularity. The probability jumped from 46% to 54% in just 24 hours, a notable rise from 38% just a week ago. With over $1 million wagered on the outcome, it’s clear that crypto-native speculators are taking the recession risk seriously.

What Defines a Recession in This Market?

According to Polymarket, this contract will resolve to “Yes” if either of the following occurs before January 1, 2026:

  • The National Bureau of Economic Research (NBER) officially declares a U.S. recession.
  • The seasonally adjusted annualized real GDP shows a negative change for two consecutive quarters.

These are the same benchmarks used by most economists, lending legitimacy to the contract’s criteria—even if Polymarket remains unavailable to U.S. residents due to regulatory concerns.

Broader Market Reaction

While crypto bettors are ramping up their recession predictions, traditional institutions aren’t far behind. JPMorgan now places the risk of a U.S. recession at 40%, up from 30%, explicitly citing Trump’s aggressive trade policies as a contributing factor.

Meanwhile, the stock market took a hit following the tariff announcement, with major indices falling sharply. Interestingly, Bitcoin remained relatively steady, perhaps indicating that some investors are viewing crypto as a hedge in an increasingly uncertain macro environment.

What About Other Prediction Platforms?

The sentiment isn’t just isolated to the crypto world. Kalshi, a federally regulated prediction platform, is showing identical odds of 54% for a 2025 U.S. recession. This is a massive jump from a low of 17% in Q1 2025, indicating that this concern is rapidly moving from the fringe to the mainstream.

What This Means Going Forward

The sharp uptick in recession odds—both on-chain and off—suggests a growing consensus: Trump’s trade moves could seriously backfire economically. While protectionist measures might resonate politically, the ripple effects on imports, inflation, and global supply chains could drag down U.S. growth.

Investors, economists, and crypto speculators alike are now recalibrating their expectations. If these predictions hold true, we may be looking at a recession in 2025 driven not by a financial crisis or pandemic—but by policy.

Bottom Line

Prediction markets like Polymarket and Kalshi are sending a clear message—recession risk is no longer hypothetical. And with big money backing that sentiment, both Wall Street and Washington should take note.