The U.S government shutdown passed into its fourth day and prediction markets were indicating a long durability in the stalemate. Information provided by Polymarket, a prediction website powered by blockchain, indicates a 56 percent chance that the shutdown will be extended at least until October 15 or beyond. There was an increase of 9 percentage point in two days, a sign of increasing pessimism. Previous dates like October 6-9 fell to 9% but October 3-5 fell below 1%. The odds of October 10-14 are approximately 33%. Daily trading volumes were over $3.1 million, which highlights the high involvement.
Why the Government Shut Down
Prior to the end of the fiscal year on October 1 2025, Congress did not approve a funding bill. The stalemate is based on profound partisan lines. President Donald Trump has advocated significant reductions in federal programmes. Moderates and democrats are against cuts they term as disruption. It has put 750,000 federal workers on furlough or unpaid leave. Key services such as military action, and air traffic control are maintained. However, there is disruption to the agencies dealing with parks, permits and visas.
Historical Context
Since the late 20 th century, government shutdowns have influenced the politics of the United States. The most recent and longest shutdown was recorded during the fight over border wall funding; a fight that lasted 35 days between December 2018 and January 2019. Other significant shutdowns were a 21-day shutdown in 1995-96 during the presidency of Bill Clinton. The Congressional Research Service cites 14 days as the average period of shutdown since 1990. The government has suffered 14 one-day or more shutdowns since the start of the modern budget process in 1976. This has increased with the entrenching of partisan lines.
Economic Costs
Short cuts are not harmful. But protracted standoffs have their price. According to Congressional Budget Office (CBO), the U.S. GDP reduction in the 2018-2019 shutdown amounted to $11 billion, with 3 billion of it being an irreversible loss. Markets are concerned with late government payments, paralyzed contracts and reduced consumer confidence. According to the Washington Post, funding of WIC nutrition programs may dry up in few weeks. Politico reports that the department of energy risks having insufficient money to check nuclear weapons after eight days. Labor Department has already delayed the month of jobs report. That places the economists in the dark as they are not able to see the trends of employment and it undermines investor confidence.
Prediction Market Signals
Polymarket contracts give people the opportunity to place a bet on real-world events in cryptocurrency. Traders purchase Yes or No shares on the basis of certain outcomes. A 56c value of a Yes share means a probability of 56% that this will happen. The prediction markets have a history of accuracy in predictions. Research conducted at the University of Iowa and MIT discovered that the markets tend to compete or do better than conventional polling during elections. The odds in the shutdown cases give an indication of the group anticipation regarding the duration of delaying the congress. The increase in the likelihood of a resolution in October 15 or later is in line with historic averages. An extension of the shutdown past mid-October will get near the median duration of previous shutdowns.
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56% Chance U.S. Shutdown Lasts 10 More Days, Prediction Markets Show
The U.S government shutdown passed into its fourth day and prediction markets were indicating a long durability in the stalemate. Information provided by Polymarket, a prediction website powered by blockchain, indicates a 56 percent chance that the shutdown will be extended at least until October 15 or beyond. There was an increase of 9 percentage point in two days, a sign of increasing pessimism. Previous dates like October 6-9 fell to 9% but October 3-5 fell below 1%. The odds of October 10-14 are approximately 33%. Daily trading volumes were over $3.1 million, which highlights the high involvement.
Why the Government Shut Down
Prior to the end of the fiscal year on October 1 2025, Congress did not approve a funding bill. The stalemate is based on profound partisan lines. President Donald Trump has advocated significant reductions in federal programmes. Moderates and democrats are against cuts they term as disruption. It has put 750,000 federal workers on furlough or unpaid leave. Key services such as military action, and air traffic control are maintained. However, there is disruption to the agencies dealing with parks, permits and visas.
Historical Context
Since the late 20 th century, government shutdowns have influenced the politics of the United States. The most recent and longest shutdown was recorded during the fight over border wall funding; a fight that lasted 35 days between December 2018 and January 2019. Other significant shutdowns were a 21-day shutdown in 1995-96 during the presidency of Bill Clinton. The Congressional Research Service cites 14 days as the average period of shutdown since 1990. The government has suffered 14 one-day or more shutdowns since the start of the modern budget process in 1976. This has increased with the entrenching of partisan lines.
Economic Costs
Short cuts are not harmful. But protracted standoffs have their price. According to Congressional Budget Office (CBO), the U.S. GDP reduction in the 2018-2019 shutdown amounted to $11 billion, with 3 billion of it being an irreversible loss. Markets are concerned with late government payments, paralyzed contracts and reduced consumer confidence. According to the Washington Post, funding of WIC nutrition programs may dry up in few weeks. Politico reports that the department of energy risks having insufficient money to check nuclear weapons after eight days. Labor Department has already delayed the month of jobs report. That places the economists in the dark as they are not able to see the trends of employment and it undermines investor confidence.
Prediction Market Signals
Polymarket contracts give people the opportunity to place a bet on real-world events in cryptocurrency. Traders purchase Yes or No shares on the basis of certain outcomes. A 56c value of a Yes share means a probability of 56% that this will happen. The prediction markets have a history of accuracy in predictions. Research conducted at the University of Iowa and MIT discovered that the markets tend to compete or do better than conventional polling during elections. The odds in the shutdown cases give an indication of the group anticipation regarding the duration of delaying the congress. The increase in the likelihood of a resolution in October 15 or later is in line with historic averages. An extension of the shutdown past mid-October will get near the median duration of previous shutdowns.