The U.S. Supreme Court ruled 6-3 that President Trump lacked authority under the 1977 International Emergency Economic Powers Act (IEEPA) to impose sweeping emergency tariffs on nearly all imports. Now, prediction markets are lighting up as traders place hefty bets on what comes next in this high-stakes political sequel.
Court Ruling and Potential Trump Workarounds
The justices concluded that IEEPA does not plainly grant a president the power to levy tariffs of unlimited scope, size and duration, dismantling most of Trump's tariff program. The Court made clear that Congress holds the constitutional authority to impose taxes and duties. While this may cool the 'Liberation Day' tariffs, insiders expect Trump to pivot to other trade-law mechanisms—such as Section 301 investigations and a fresh 10% global tariff under Section 122—to keep tariffs alive in different legal attire. Bettors are now flocking to prediction markets to wager on the next chapter.
Prediction Market Data: Polymarket vs. Kalshi Divergence
A Polymarket contract asks whether the U.S. government will be forced to refund tariffs by June 30, 2026. Weekend trading volume stands at $98,432, with a 17% probability of a “Yes” outcome (17 cents) and 84% for “No.” However, Kalshi's contract on a court-ordered refund has drawn $231,531 total volume, featuring notably different odds. On Kalshi, bettors peg the odds of a refund order before April 1, 2026 at just 20% (19 cents), but confidence climbs to 54% by July 2026 (54 cents) and swells to 72% for the period before 2027 (75 cents). Recent price action has leaned heavily toward “Yes,” with July 2026 and 2027 contracts advancing 15 and 23 points respectively.
Tariff Continuation and Country-Specific Bets
On Polymarket's tariffs board, a new 10% U.S. blanket tariff taking effect by Feb. 28 carries 95% odds with $36,300 in volume, and the question of whether that same levy will still be in place on March 31 sits at 84% with $15,000 traded. Congress stepping in by March 31 barely registers at 6% and $2,500. For China, bettors give a 63% chance that the tariff rate lands in the 5% to 15% range by March 31, backed by $21,100 in volume, while a Trump visit to China by April 30, 2026 commands 95% odds and a hefty $2 million in trades.
Canada shows more restrained appetite: a tariff increase by June 30 carries 27% odds with $24,500 volume, and the prospect of a dramatic 100% tariff by that date lingers at 9%. On the legal front, bettors assign a 93% chance that Trump faces another lawsuit over tariff powers by March 31, with $5,200 on the line, while the court-forced refund contract stands at 17% and $98,400. A so-called tariff dividend has modest odds—10% by March 31 ($111,000 traded) and 15% by June 30 ($5,200). Looking further out, Indonesia leads the pack at 25% among countries Trump might strike a new trade deal with before 2027, drawing $216,000 in wagers.
Prediction Markets as Real-Time Barometer
Whether Trump recalibrates through alternative statutes, escalates the legal fight, or opts for a political counteroffensive, the Supreme Court's ruling has not ended the tariff saga—it has simply shifted the battlefield. Prediction markets now serve as a real-time barometer of expectations, translating legal uncertainty and political brinkmanship into percentages, price swings, and hard dollars as traders wager on the next chapter of U.S. trade policy.