The US government will partially shut down at midnight, despite the Senate voting in favor of a funding package aimed at keeping the government running, demonstrating the importance of specificity in prediction market contracts.
The House of Representatives is out of session this week and won’t return until Monday. Because the House needs to pass the package that the Senate voted on Friday night, this means the government will technically shut down at 12:00 a.m. ET on Saturday and will likely remain closed through the weekend. It is only a partial shutdown and should not have a significant effect on US residents.
In this way, the shutdown differs radically from the previous US government shutdown, which was the longest in the country’s history and saw federal employees go without pay for more than a month while lawmakers negotiated upcoming increases in healthcare premiums.
The Polymarket and Kalshi contracts that allow users to bet on whether or not the government will shut down vary in how exactly they defined a government shutdown, demonstrating the importance of specificity for these event contracts.
“This market will resolve to ‘Yes’ if the U.S. Office of Personnel Management (OPM) announces another federal government shutdown due to a disruption in appropriations by January 31, 2026 at 11:59 pm ET. Otherwise, this market will resolve to ‘No,'” one contract read. Under the terms of this contract, a partial closure qualifies as a closure, but more importantly, it is dependent on OPM announcing a closure.
As of Friday afternoon, the odds were 88%, having risen steadily from 40% over the past 24 hours even though reports on Thursday made it clear that the House would not be able to vote before Monday.
A similar contract from Kalshi also pointed to OPM as his way of verifying the outcome of the bet. The odds of a closure were 93% at press time, having increased from 44% in the last 24 hours.
OPM’s media response email did not immediately respond to a request for comment on whether it would announce a closure.
Other bets were more specific. A Polymarket contract allowed users to bet how long the government would remain closed, with one, two, and more than three days having over 90% chances at the time of this publication. A counterpart of Kalshi suggested that the bettors gave “more than [two] days” with more than 90% probability.
Another Polymarket contract asking whether government funding would lapse on January 31 had a 99.6% probability at press time, defining a lapse as “the failure of the President to sign the relevant bills extending government funding” by 11:59 pm ET on Friday night, which, again, he cannot do until the House votes on the package on Monday.
