Following the report that economic activity in the U.S. not only stalled but actually decreased during the first quarter—crypto and other financial markets are already getting the initial impact of a potential recession in America in 2025.
As reported earlier, the United States Q1 GDP came in at a negative 0.3%—a stark contrast from the initial forecast of a 0.2% increase in economic activity. Moreover, this result not only puts the current administration under severe pressure but also will likely convince the Federal Reserve to reject Trump’s calls for rate cuts at the upcoming FOMC meeting on May 6—7.
Polymarket Recession Bet Hits ATH
Only a few minutes after the GDP data came in, Polymarket—the platform known for real-time prediction markets—saw a surge in activity. In particular, the contract that predicts whether America will enter a recession in 2025 hit its all-time highest in favor of “yes” at 71%.
The bet surged by 7% in the last hour alone, reflecting the immediate market reaction to the disappointing GDP print. Other financial instruments are also already feeling the impact, including stock and crypto.
Bitcoin Takes a Hit
The market-leading cryptocurrency halted its ascending momentum only minutes after the GDP Q1 report. Bitcoin was trading at $95,208 before the report, only to fall by 0.68% only five minutes after the news broke.
Currently, $BTC trades at $94,480 and still experience a surplus of trading volume as investors react to the unexpected -0.3% GDP print.
So, are we heading towards a full on recession, or is the Trump administration bet on aggressive foreign trade pay off by the end of the year? Bookmark us and we’ll keep you updated, deal?
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