The U.S. Supreme Court will return from a four-week recess on Jan. 9 with a potentially momentous economic ruling on whether President Donald Trump's administration lawfully imposed sweeping tariffs under emergency powers, or whether the tariffs on hundreds of billions of dollars in imports violate Congressional restrictions.
In prediction markets, the government only has a 23% to 30% chance of winning. Treasury officials anticipate tens of billions of dollars in refunds and hundreds of billions of dollars in lost revenue over 10 years if tariffs are lowered.
Meanwhile, Bitcoin options traders are pricing in seven-day implied volatility near multi-month lows, with a 25-delta skew leaning toward calls. According to CoinGlass data, the futures funding rate has been hovering around 0.0076% to 0.0094% per eight hours, well below the foam level.
The stock market ended 2025 at near-record levels, with the dollar index down 9.5% from a year ago and the 10-year Treasury yield hovering around 4.2%.
This discrepancy is clear. Although Washington and forecasting platforms are treating Friday as a binary macro event, neither cross-asset markets nor Bitcoin derivatives are showing a clear “tariff shock” premium.
Directional movements, potential for high volatility
President Trump's “Emancipation Day” tariffs were imposed in April 2025 using the International Emergency Economic Powers Act, a 1977 law typically limited to national security threats.
Two lower courts have ruled that the IEEPA exceeds Congress's intent and that the tariffs are illegal. The Supreme Court heard arguments in November, with justices from a wide range of ideologies expressing skepticism of the government's position.
Tariffs under IEEPA account for about half of all U.S. tariff revenues, contributing to price pressures and making 2025 the dollar's worst year since 2017. If repealed, the impact on refunds and revenue would be hundreds of billions of dollars over the next decade.
Polymarket traders predict a 77% chance that the Supreme Court will rule against the Trump administration, but Calci's odds are slightly lower at 69%.
In the niche market where importers sell potential refund claims to hedge funds, these refund claims trade for around 20-30 cents on the dollar, with macro analysts matching this to estimate real odds in the 40-45% range.
The delta between prediction market odds and secondary refund claim prices suggests that significant uncertainty remains, precisely the situation where event-driven volatility can spike if there is a surprise verdict.
Bitcoin derivatives also do not appear to be directionally biased by traders, but this decision could lead to higher volatility.
The Deribit Volatility Index (DVOL) rose from 43 on January 1st to a local high of 46.4 on January 5th. Nevertheless, it remains one of its lowest levels since late November.
Additionally, the 25-delta call-put skew is slightly negative with approximately -1.3 volumes for both the one-week and one-month contracts, meaning short-term puts are still trading slightly richer than equivalent calls.
The differences between the tenors are negligible, so the option surface does not show a strong direction around the event. The data shows a modest and general preference for downside hedging over speculative upside grabbing.
This, combined with perpetual futures funds, has been hovering around 0.0076% to 0.0094% per eight hours, well below levels of 0.01% or above that are indicative of frothy long leverage.
However, open interest in Bitcoin futures has already ballooned to more than $60 billion, showing that the system has plenty of leverage, even though there is no particular emphasis on crash hedging or price lottery.
In any case, even if the Supreme Court issues a surprise result, the action may be less about “new information” and more about how $60 billion in positioning is spent on contested pricing changes.
Two results, two transmission channels
If the court upholds the tariffs, it would go against prediction markets and surprise macro desks.
What we can see is that import prices are rising and becoming more sticky, and there is less confidence that inflation will moderately return to target, favoring a stronger dollar and higher real yields.
This setup is risk-off for stocks, with Bitcoin on tape likely trading against other high-beta assets in a sudden down move, paralleling DXY's strength and S&P's weakness.
Slow stories are different. Persistent tariffs reinforce the idea that U.S. policy risks and fiscal vulnerabilities are structural. This is an environment where narratives of “digital gold” and “external money” tend to resurface after initial deleveraging.
This is not an immediate safe haven bid, but a theme for the second leg.
From a derivative perspective, we would expect an unexpected “pro-tariff” ruling to explode the value of short-term puts, create a spike in volatility, and drive implicit volume up on the front end.
If the courts strike down the tariffs (a likely scenario at this point), the basic lawsuits in Polymarket, Calci, and Wall Street will be justified. Reversing tariffs would effectively create a disinflationary supply-side shock and, if refunded, a potential business stimulus.
Market analysis says this is the “rocket fuel” for the stock and a tailwind for global growth expectations.
The immediate strategy will be to weaken DXY, lower long-term interest rates, narrow credit spreads, and increase stock prices. Bitcoin typically benefits from broader risk-on moves, especially if lower yields revive the “liquidity and carry” trade that fueled ETF and basis flows in 2025.
The twist is that this outcome is expected, so Bitcoin's reaction could largely depend on positioning. If the market enters January 9th with moderate front-end implied volatility, moderate funding, and no outsized put skew, there is room for BTC to rise as traders re-risk.
If options and PERP are crowded until Friday, a classic “good news, sell the facts” pattern will occur, with BTC briefly surging and then reverting back to the mean.
What does “pricing” actually mean?
Prediction markets show that this direction is partially priced in, but neither cross-asset nor BTC derivatives show a large “tariff shock” premium.
That's not the same as saying this ruling won't move the market. That means the move depends less on what the court decides and more on whether the decision is surprising relative to the position.
If tariffs are maintained, it would be a real surprise and markets are expected to see a spike in volatility as traders reassess continued inflation and a strong dollar. The reaction if tariffs are lowered will depend on whether the market is already ahead of good news or whether there is still room to chase risk-on momentum.
The current setup suggests that Bitcoin is in a zone where either outcome could create a tradeable move, but neither outcome is so overdetermined that Friday ceases to be an event.
While this ruling does not change Bitcoin's long-term trajectory, it could clarify which macro narrative will become dominant in the coming weeks. If tariffs are maintained, there will be reflation and a strong dollar, or if tariffs are lowered, there will be disinflation and a risk-on trend.
The derivatives market hasn't screamed about it yet, but that means there's still room for caution.
