What if a digital euro destabilises bank deposits?
A retail digital-euro launch sparks deposit-flight fears, widening bank credit spreads and pressuring financials until the ECB hard-caps holdings mid-rollout. There's no clean historical analogue; the nearest is deposit-run dynamics in March-2023 (SVB/Credit Suisse) where the fear of flight, not the flight itself, repriced bank credit. The marginal trade is European bank senior/sub spreads and EUR rates; the crypto leg is small and second-order here.
Every number ships with its receipt — the odds, the range, the precedents, and a public grade at Reality Check. The statistical machinery that produces it is proprietary.
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 (electric blue) over time vs the market's (Polymarket, amber), from the past toward the 1–3 years 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. Loading the probability audit trail…
What it would mean
If this plays out, it is a risk-off shock. A retail digital-euro rollout triggers bank-deposit flight fears, forcing the ECB to impose holding caps mid-launch. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Financial conditions ▲ — which propagate through our causal graph to the markets below.