Polymarket's $100B Revenue Bet: Flow Analysis of the Odds

The central financial bet on Polymarket is whether U.S. revenue will fall below $100 billion in 2025. This high-stakes market has drawn significant flow, with volume of $866,282 reflecting active speculation. Currently, the odds are heavily skewed against a drop, with 68% of bettors indicating that the U.S. will not see such a drastic revenue decline.

This represents a notable shift from earlier in the year. In April, the market showed a 65% probability in favor of the U.S. falling short of the $100 billion mark. The change in sentiment points to a major new development in the fiscal picture.

The primary driver of this shift is the explosive growth in customs duties. The federal government raised $195 billion in customs duties in Fiscal Year 2025, a more than 250% increase from the prior year. This surge in tariff revenue has fundamentally altered the baseline, making a collapse below $100 billion appear less likely in the eyes of the market.

The Tariff Revenue Engine: Flow and Impact

The engine behind the market's shifted odds is a torrent of tariff revenue. For the full calendar year, customs duties surged to $287 billion, a 192% year-over-year increase. The fourth quarter alone contributed a staggering $97.5 billion, which was a 281% jump from the same period the prior year. This flow is the direct fiscal impact of aggressive new trade policy.

The intensity of this flow is captured by the average effective tariff rate. In October 2025, that rate hit 11.4 percent, the highest level since 1943. This means the government collected more than 11 cents in tariff revenue for every dollar of goods imported, a massive fiscal multiplier on trade volumes.

The fiscal significance is enormous. The Congressional Budget Office projects these tariffs will reduce primary deficits by $3.3 trillion over 2025-35. This isn't just a one-year windfall; it's a structural shift in the federal balance sheet, providing a massive buffer against a revenue collapse.

Catalysts and Risks: What Could Change the Flow

The market's current odds are set to resolve on official Treasury data for FY 2025, with the deadline of February 28, 2026. Until then, the flow of bets will remain sensitive to any news that could alter the fiscal baseline. The primary catalyst is the Supreme Court's upcoming decision on the legality of the tariffs. A ruling that the tariffs are illegal could reverse the revenue surge, with court rulings able to reduce and reverse these gains.

The most immediate risk is a legal reversal. Evidence suggests the U.S. Trade Court has ruled the majority of these new tariffs illegal, and a final Supreme Court decision could mandate refunds. The potential scale is massive: one analysis estimates roughly $90 billion in refunds if the tariffs are struck down. This alone would halve the projected tariff revenue, directly threatening the market's current "No" bet.

Beyond the legal overhang, there's a long-term structural risk. The tariffs are projected to reduce U.S. GDP by 0.5 to 0.7 percent. This drag on economic growth creates a persistent headwind for future revenue, as a smaller economy generates less tax income. The market's current confidence in a $100 billion+ floor may be vulnerable to this slow-motion pressure.