diff --git a/compiler/src/dotty/tools/dotc/ast/Desugar.scala b/compiler/src/dotty/tools/dotc/ast/Desugar.scala
index c2517145c935..24be0530ac5b 100644
--- a/compiler/src/dotty/tools/dotc/ast/Desugar.scala
+++ b/compiler/src/dotty/tools/dotc/ast/Desugar.scala
@@ -1336,9 +1336,9 @@ object desugar {
     Function(param :: Nil, Block(vdefs, body))
   }
 
-  def makeContextualFunction(formals: List[Type], body: Tree, isErased: Boolean)(implicit ctx: Context): Tree = {
+  def makeContextualFunction(formals: List[Tree], body: Tree, isErased: Boolean)(implicit ctx: Context): Function = {
     val mods = if (isErased) Given | Erased else Given
-    val params = makeImplicitParameters(formals.map(TypeTree), mods)
+    val params = makeImplicitParameters(formals, mods)
     FunctionWithMods(params, body, Modifiers(mods))
   }
 
diff --git a/compiler/src/dotty/tools/dotc/ast/TreeInfo.scala b/compiler/src/dotty/tools/dotc/ast/TreeInfo.scala
index 657ce9fd0e94..7f4c93d8542e 100644
--- a/compiler/src/dotty/tools/dotc/ast/TreeInfo.scala
+++ b/compiler/src/dotty/tools/dotc/ast/TreeInfo.scala
@@ -98,6 +98,11 @@ trait TreeInfo[T >: Untyped <: Type] { self: Trees.Instance[T] =>
     case _ => tree
   }
 
+  def stripAnnotated(tree: Tree): Tree = tree match {
+    case Annotated(arg, _) => arg
+    case _ => tree
+  }
+
   /** The number of arguments in an application */
   def numArgs(tree: Tree): Int = unsplice(tree) match {
     case Apply(fn, args) => numArgs(fn) + args.length
diff --git a/compiler/src/dotty/tools/dotc/typer/ProtoTypes.scala b/compiler/src/dotty/tools/dotc/typer/ProtoTypes.scala
index eeb65cc5727a..4c2ce2ed9ee0 100644
--- a/compiler/src/dotty/tools/dotc/typer/ProtoTypes.scala
+++ b/compiler/src/dotty/tools/dotc/typer/ProtoTypes.scala
@@ -598,7 +598,7 @@ object ProtoTypes {
    */
   private def wildApprox(tp: Type, theMap: WildApproxMap, seen: Set[TypeParamRef], internal: Set[TypeLambda])(using Context): Type = tp match {
     case tp: NamedType => // default case, inlined for speed
-      val isPatternBoundTypeRef = tp.isInstanceOf[TypeRef] && tp.symbol.is(Flags.Case) && !tp.symbol.isClass
+      val isPatternBoundTypeRef = tp.isInstanceOf[TypeRef] && tp.symbol.isPatternBound
       if (isPatternBoundTypeRef) WildcardType(tp.underlying.bounds)
       else if (tp.symbol.isStatic || (tp.prefix `eq` NoPrefix)) tp
       else tp.derivedSelect(wildApprox(tp.prefix, theMap, seen, internal))
diff --git a/compiler/src/dotty/tools/dotc/typer/Typer.scala b/compiler/src/dotty/tools/dotc/typer/Typer.scala
index 8ed14c2fd32b..5e56352c739f 100644
--- a/compiler/src/dotty/tools/dotc/typer/Typer.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Typer.scala
@@ -1049,15 +1049,35 @@ class Typer extends Namer
      */
     var paramIndex = Map[Name, Int]()
 
-     /** If function is of the form
+    /** Infer parameter type from the body of the function
+     *
+     *  1. If function is of the form
+     *
      *      (x1, ..., xN) => f(... x1, ..., XN, ...)
+     *
      *  where each `xi` occurs exactly once in the argument list of `f` (in
      *  any order), the type of `f`, otherwise NoType.
+     *
+     *  2. If the function is of the form
+     *
+     *     (using x1, ..., xN) => f
+     *
+     *  where `f` is a contextual function type of the form `(T1, ..., TN) ?=> T`,
+     *  then `xi` takes the type `Ti`.
+     *
      *  Updates `fnBody` and `paramIndex` as a side effect.
      *  @post: If result exists, `paramIndex` is defined for the name of
      *         every parameter in `params`.
      */
-    lazy val calleeType: Type = fnBody match {
+    lazy val calleeType: Type = untpd.stripAnnotated(fnBody) match {
+      case ident: untpd.Ident if isContextual =>
+        val ident1 = typedIdent(ident, WildcardType)
+        val tp = ident1.tpe.widen
+        if defn.isContextFunctionType(tp) && params.size == defn.functionArity(tp) then
+          paramIndex = params.map(_.name).zipWithIndex.toMap
+          fnBody = untpd.TypedSplice(ident1)
+          tp.select(nme.apply)
+        else NoType
       case app @ Apply(expr, args) =>
         paramIndex = {
           for (param <- params; idx <- paramIndices(param, args))
@@ -2450,7 +2470,34 @@ class Typer extends Namer
 
   protected def makeContextualFunction(tree: untpd.Tree, pt: Type)(using Context): Tree = {
     val defn.FunctionOf(formals, _, true, _) = pt.dropDependentRefinement
-    val ifun = desugar.makeContextualFunction(formals, tree, defn.isErasedFunctionType(pt))
+
+    // The getter of default parameters may reach here.
+    // Given the code below
+    //
+    //     class Foo[A](run: A ?=> Int) {
+    //        def foo[T](f: T ?=> Int = run) = ()
+    //     }
+    //
+    // it desugars to
+    //
+    //     class Foo[A](run: A ?=> Int) {
+    //        def foo$default$1[T] = run
+    //        def foo[T](f: T ?=> Int = run) = ()
+    //     }
+    //
+    // The expected type for checking `run` in `foo$default$1` is
+    //
+    //      <?> ?=> Int
+    //
+    // see tests/pos/i7778b.scala
+
+    val paramTypes = {
+      val hasWildcard = formals.exists(_.isInstanceOf[WildcardType])
+      if hasWildcard then formals.map(_ => untpd.TypeTree())
+      else formals.map(untpd.TypeTree)
+    }
+
+    val ifun = desugar.makeContextualFunction(paramTypes, tree, defn.isErasedFunctionType(pt))
     typr.println(i"make contextual function $tree / $pt ---> $ifun")
     typed(ifun, pt)
   }
diff --git a/tests/pos/i7778.scala b/tests/pos/i7778.scala
new file mode 100644
index 000000000000..cefed289c819
--- /dev/null
+++ b/tests/pos/i7778.scala
@@ -0,0 +1,12 @@
+object Example extends App {
+  final case class Foo[A](run: A ?=> Int)
+}
+
+object Example2 extends App {
+  final case class Foo[A, B](run: (A, B) ?=> Int)
+}
+
+
+object Example3 extends App {
+  final case class Foo[A, B](run: () ?=> Int)
+}
diff --git a/tests/pos/i7778b.scala b/tests/pos/i7778b.scala
new file mode 100644
index 000000000000..eaea85e5cf3b
--- /dev/null
+++ b/tests/pos/i7778b.scala
@@ -0,0 +1,4 @@
+class Foo[A](run: A ?=> Int) {
+  def foo[T](f: T ?=> Int = run) = ()
+}
+