Crypto prediction markets reflect rising recession odds amid US economic contraction

Crypto prediction markets are signaling growing expectations of a U.S. recession this year after fresh economic data showed the economy contracted in the first quarter of 2025.

According to the latest figures released by the US Commerce Department, gross domestic product declined by 0.3% between January and March. This drop comes after a 2.4% expansion in the previous quarter, marking the first economic pullback since 2022.

Following the report, users on the decentralized betting platform Polymarket have pushed the odds of a 2025 recession to 66%, the highest recorded this year.

The event market has also seen strong engagement, with over $3.8 million in total volume traded as of press time.

Meanwhile, the sentiment is mirrored on Kalshi, a regulated event-trading exchange, where the odds of a recession this year rose to a high of 74% but slightly retracted to 71% as of press time.

Reacting to the economic downturn and the increased probability of a recession, US lawmaker Daniel Goldman strongly rebuked the Trump administration’s trade policies.

He argued that the tariffs have already driven up consumer costs, weakened confidence, and contributed to the decline in GDP.

Goldman said:

“Trump is the first president to knowingly crash the economy…As he barrels us into a recession, working people will suffer while his cronies get rich.”