Fed Rate Cut Odds Slip: AI & Bitcoin Predictions See Significant Swings

Prediction markets have been dynamic over the past 24 hours, with declining confidence in a near-term Federal Reserve rate cut, while AI and cryptocurrency long-shots gained ground. The most significant shift came from the Fed rate cut market, which saw substantial trading volume as expectations adjusted.

## Macro & Monetary Policy

The probability of the Federal Reserve cutting rates at its next FOMC meeting has fallen to 64%, a 3.1 percentage point decrease in 24 hours, with over $2.1 million in volume traded on this market. This suggests a growing belief among traders that the Fed may hold steady for longer than previously anticipated. Despite this near-term pessimism, the outlook for future economic growth saw a slight uptick, with the market for US Q3 2026 GDP growth exceeding 2.5% rising to 41%, up 1.8 percentage points.

## Artificial Intelligence Race

Optimism for advanced AI deployments continues to climb. The market predicting GPT-6's release in 2026 jumped by 5.8 percentage points to 27%, making it the largest single percentage point move of the day, with a hefty $1.64 million in volume. Similarly, the likelihood of an AI model scoring 90%+ on the ARC-AGI benchmark in 2026 increased by 4.5 percentage points to 33%, indicating growing confidence in rapid advancements within the AI research community.

## Cryptocurrency Bets

Bitcoin's ascent over the past day is reflected in prediction markets, with the probability of BTC reaching $200,000 before 2028 rising 2.4 percentage points to 38%. This market saw the highest trading volume at $4.82 million, underscoring intense speculation around Bitcoin's future price. Conversely, the notion of Ethereum flipping Bitcoin by market cap in 2026 saw its probability decline by 1.2 percentage points to a mere 8%, suggesting traders still overwhelmingly favor Bitcoin's long-term dominance.

## Political & Sports Outlook

On the political front, the market for Democrats winning the 2028 US presidential election saw a minor bump, increasing by 0.9 percentage points to 47%. This market generated the highest overall trading volume, exceeding $9.8 million. Meanwhile, sports bettors became slightly less confident in the Lakers' prospects, with their odds of winning the 2027 NBA Finals slipping by 0.6 percentage points to 12%.

**What to watch:** Continued Fed commentary and CPI data will be key in determining if the current shift in rate-cut expectations holds.