Prediction Markets Lift Odds of an Unexpected Fed Rate Hike

Prediction markets are quickly repricing the risk of a surprise Federal Reserve rate increase, drawing fresh attention from crypto traders. Across major platforms, participants have pushed up the implied probability that the Fed will raise rates at the conclusion of its two-day July meeting. On Polymarket, where contract prices reflect crowd-implied odds, the "no change" outcome dropped 8.9 percentage points in the past 24 hours to 73.25%. The contract pricing a 25-basis-point hike rose 9.7 points to 26.65%. Total volume on Polymarket stands at $100.83 million, including $5.78 million traded over the last day. Myriad, the prediction market run by Dastan, parent company of Decrypt, showed a similar split: about 74% for "no change" and roughly 27% for a hike. Over the past day, Myriad's "no change" odds fell around 9% while the hike odds climbed about 8%. Traditional markets are also flashing higher anxiety. Fed funds futures, widely used to gauge expectations for the Fed's next move, indicated about a 37.6% chance of a rate increase as of Monday afternoon. A basis point equals 0.01 percentage point. A 25-basis-point hike would lift the Fed's target range from 3.50%–3.75% to 3.75%–4.00%. For crypto markets, the stakes are clear: higher rates raise borrowing costs, typically cooling spending and investment and weighing on risk appetite—pressure that often hits assets such as Bitcoin and technology stocks. Lower rates tend to support risk-taking and can provide a tailwind for those markets. The renewed debate comes after the Fed left rates unchanged in June while warning inflation remained elevated. Officials' median projection pointed to a year-end rate near 3.8%. June's inflation reading eased to 3.5% from May's 4.2%, giving policymakers room to pause even as investors reassess incoming data and shifting expectations. The Federal Open Market Committee meets July 28–29, with the interest-rate decision scheduled for 2 p.m. Eastern on July 29. Traders expect prediction markets and futures to remain volatile as participants price the possibility of a last-minute surprise.