Amid an escalating trade war, cryptocurrency bettors sharply raised the odds that President Donald Trump would impose additional tariffs on a defiant China. 

What happened: Bets in favor of the outcome surged past 80% on Polygon (CRYPTO: POL)-based Polymarket, marking a 58 percentage point increase over the last 24 hours.

Over $21,257 has been wagered on the possibility. This market will resolve to "Yes" if Trump signs any federal legislation or performs any executive action that imposes additional duties on China over and beyond the 54% general tariff before May 1.

Polymarket is a decentralized prediction market where people can bet on major world events with cryptocurrencies. Users can purchase or sell outcome shares, "Yes" or "No," which can be redeemed for $1 if the outcome is correct but are worthless if it's incorrect.

Note that Polymarket is not available to U.S. residents due to regulatory hurdles.

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Why It Matters: The bets came against the backdrop of mounting trade war concerns, threatening to derail markets worldwide.

China announced a 34% tariff on all goods imported from the U.S. in retaliation for the 54% duties imposed by the Trump-led administration during the so-called Liberation Day last week.

Trump has threatened to impose an additional 50% duty on Chinese imports if Beijing does not drop the 34% tariffs. Meanwhile, China remains defiant, willing to continue the war until the end. 

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