What if the dollar falls below half of global FX reserves?
Dollar reserve share dropping below 50% is a confidence milestone, so the trade mirrors de-dollarization: long end selling (30y +11bp), gold (+3%) and bitcoin bid, DXY lower — a slow-burn term-premium repricing, not a crash. Rhymes with the multi-decade post-Bretton-Woods erosion and the post-2022 acceleration in central-bank gold buying. Forward angle: the milestone is largely a lagging confirmation of flows already underway, so the marginal market impact is smaller than the headline — gold is the asset that front-runs it.
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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 3–10 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. The US dollar falls below 50% of global FX reserves — a reserve-dominance milestone. The trigger decomposes into signed root‑shocks — Dollar/reserve confidence ▼ — which propagate through our causal graph to the markets below.