What if OFAC sanctions a privacy-focused Ethereum rollup?
OFAC sanctioning a privacy rollup and its sequencer forces US infra to censor, fragmenting the chain and hitting ETH (-4.8%) on rollup-trust and US-access fear — a Tornado-Cash-Aug-2022 sanctions analogue, where compliance-driven censorship split the ecosystem. The current roots' trade_tension overstates the tariff/semis/Alibaba leg, which has no link to a sanctions action. Keep the shock inside crypto; the real second-order risk is whether US validators/relays over-comply and degrade the chain's neutrality.
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. OFAC sanctions a privacy-focused rollup and its sequencer, forcing US infrastructure providers to censor and fragmenting the chain. The trigger decomposes into signed root‑shocks — Crypto confidence ▼ · Crypto liquidity ▼ · Geopolitical risk ▲ — which propagate through our causal graph to the markets below.