What if a deep crypto drawdown is large enough to dent consumer spending?
A deep crypto drawdown wipes out retail paper gains broadly enough to dent consumer spending, the household-exposure channel the FSOC notes has grown with mass adoption.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 6–18 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-off shock. A deep crypto drawdown wipes out retail paper gains broadly enough to dent consumer spending, the household-exposure channel the FSOC notes has grown with mass adoption. The trigger decomposes into signed root‑shocks — Bitcoin ▼ · Consumer spending ▼ · Crypto confidence ▼ · Recession signal ▲ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -5.0% hist -3.33–-1.35% · other way -5.96% (n=12) |
| 2 | Ether ETHon Hyperliquid 📈 chart | Crypto | ▼ -3.6% hist -16.03–+1.25% · other way -3.85% (n=12) |
| 3 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▼ -2.8% hist -10.48–+1.19% · other way -3.27% (n=12) |
| 4 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▼ -2.6% hist -11.98–+0.83% · other way -15.5% (n=12) |
| 5 | Coinbase COINon Hyperliquid 📈 chart | Equity | ▼ -2.0% hist -1.45–-0.6% · other way +6.46% (n=12) |
| 6 | Hyperliquid (HYPE) HYPEon Hyperliquid | Crypto | ▼ -1.2% model prior · unmeasured |
| 7 | Financials XLF 📈 chart | Equity | ▼ -0.2% hist -0.19–+0.05% · other way -0.69% (n=12) |
| 8 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▼ -0.2% hist -0.28–+1.24% · other way +0.34% (n=12) |
| 9 | High-yield credit HYG 📈 chart | Rate | ▼ -0.2% hist -0.21–+0.21% · other way +0.08% (n=12) |
Probable recommendation
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| SOL SOL | SHORT | -9.0% · 5d -10.0% | 76% | 32 | 0.42 | ✓ matches cascade |
| ETH ETH | SHORT | -12.1% · 5d -9.2% | 74% | 33 | 0.41 | ✓ matches cascade |
| SPX SPX | LONG | +1.1% · 5d -0.6% ↺ fades | 71% | 40 | 0.38 | ⚠ differs |
| Bitcoin BTC | SHORT | -8.0% · 5d -6.1% | 70% | 34 | 0.34 | ✓ matches cascade |
| 10y yield DGS10 | SHORT | -12bp · 5d -7bp | 61% | 40 | 0.18 | · |
| US dollar DXY | SHORT | -0.4% · 5d -0.0% | 59% | 40 | 0.15 | · |
| High-yield credit HYG | LONG | +0.3% · 5d +0.3% | 55% | 39 | 0.08 | ⚠ differs |
| Volatility VIX | LONG | +1.0% · 5d +0.7% | 53% | 39 | 0.05 | · |
| COIN COIN | SHORT | -0.2% · 5d -1.9% | 51% | 32 | 0.03 | ✓ matches cascade |
| XLF XLF | LONG | +0.1% · 5d -0.1% ↺ fades | 51% | 39 | 0.02 | ⚠ differs |
| MSTR MSTR | LONG | +0.6% · 5d -4.6% ↺ fades | 45% | 39 | 0.00 | ⚠ differs |
| Gold XAU | SHORT | -0.3% · 5d -0.5% | 45% | 39 | 0.00 | · |