What if SMIC reaches TSMC-class 5nm economics without EUV?
SMIC hitting TSMC-class 5nm economics neutralizes the EUV moat — but the cascade is bullish (de-escalation): trade_tension negative, semis and Nasdaq rally, yuan and China internet up as the chip cold war thaws. The de-escalation analogue is the 2019 Phase-One trade-truce relief rally. Transmission: erasing China's cost penalty reduces the strategic urgency of export controls, easing the whole complex. Skeptic's note: roots correctly carry negative trade_tension/semiconductor_risk — this is the rare risk-on AI scenario.
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 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. 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 mixed shock. SMIC lifts DUV 5nm yields near TSMC parity, erasing the cost penalty and neutralizing the EUV export-control moat. The trigger decomposes into signed root‑shocks — China growth ▲ · Semiconductor supply risk ▼ · Trade tension ▼ — 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 | TSMC TSMon Hyperliquid 📈 chart | Equity | ▲ +2.1% hist +0.23–+2.3% · other way -1.02% (n=12) |
| 2 | Nvidia NVDAon Hyperliquid 📈 chart | Equity | ▲ +1.9% hist -1.13–+5.06% · other way -3.03% (n=12) |
| 3 | Semiconductors SMHon Hyperliquid 📈 chart | Equity | ▲ +1.8% hist +0.16–+2.15% · other way -1.57% (n=12) |
| 4 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▲ +1.5% hist +0.39–+0.97% · other way -0.95% (n=12) |
| 5 | Alibaba BABAon Hyperliquid 📈 chart | Equity | ▲ +1.4% hist -0.75–+3.43% · other way -1.73% (n=12) |
| 6 | ASML ASMLon Hyperliquid 📈 chart | Equity | ▲ +1.4% hist -3.0–+1.07% · other way -2.85% (n=12) |
| 7 | AMD AMDon Hyperliquid 📈 chart | Equity | ▲ +1.2% hist -2.31–+1.11% · other way -4.94% (n=12) |
| 8 | Broadcom AVGOon Hyperliquid 📈 chart | Equity | ▲ +1.2% hist -0.73–+3.6% · other way +1.53% (n=12) |
| 9 | Micron MUon Hyperliquid 📈 chart | Equity | ▲ +1.2% hist -0.87–+1.12% · other way -3.86% (n=12) |
| 10 | Marvell MRVLon Hyperliquid 📈 chart | Equity | ▲ +1.2% hist +0.04–+1.61% · other way -2.61% (n=12) |
| 11 | Chinese yuan CNY 📈 chart | FX | ▲ +1.0% hist +0.14–+0.55% · other way -0.23% (n=12) |
| 12 | Freeport (copper) FCX 📈 chart | Equity | ▲ +1.0% hist +0.3–+0.69% · other way +1.43% (n=12) |
| 13 | Tech sector XLK 📈 chart | Equity | ▲ +1.0% hist +0.22–+0.49% · other way -0.57% (n=12) |
| 14 | Copper XCUon Hyperliquid 📈 chart | Commodity | ▲ +0.8% hist -0.13–+1.43% · other way -0.63% (n=12) |
Probable recommendation
Why we may diverge from history
Trust the cascade LONG ETH: the -10.4% history is contaminated by 2018-19 US-China tariff risk-off windows that crushed all crypto on macro beta, not a read on SMIC erasing the EUV moat.
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 | -8.7% · 5d -6.2% | 78% | 39 | 0.39 | ⚠ differs |
| QCOM QCOM | SHORT | -2.3% · 5d -1.8% | 72% | 40 | 0.32 | ⚠ differs |
| ASML ASML | SHORT | -3.0% · 5d -1.6% | 70% | 40 | 0.30 | ⚠ differs |
| INTC INTC | SHORT | -2.2% · 5d -2.3% | 66% | 40 | 0.28 | ⚠ differs |
| 10y yield DGS10 | LONG | +9bp · 5d 0bp ↺ fades | 66% | 40 | 0.24 | · |
| AMD AMD | SHORT | -2.5% · 5d -1.5% | 66% | 40 | 0.23 | ⚠ differs |
| MSTR MSTR | LONG | +16.5% · 5d +2.1% | 62% | 40 | 0.23 | ✓ matches cascade |
| XLK XLK | SHORT | -0.1% · 5d -0.5% | 64% | 40 | 0.21 | ⚠ differs |
| CNY CNY | SHORT | -0.2% · 5d +0.0% ↺ fades | 60% | 40 | 0.19 | ⚠ differs |
| USDJPY USDJPY | LONG | +0.1% · 5d -0.5% ↺ fades | 60% | 40 | 0.17 | ⚠ differs |
| High-yield credit HYG | SHORT | -0.4% · 5d +-0.0% | 62% | 40 | 0.16 | · |
| AVGO AVGO | LONG | +2.8% · 5d -0.8% ↺ fades | 57% | 40 | 0.15 | ✓ matches cascade |
| US dollar DXY | SHORT | -0.2% · 5d -0.1% | 60% | 40 | 0.15 | ✓ matches cascade |
| EURUSD EURUSD | LONG | +0.3% · 5d +0.1% | 57% | 40 | 0.11 | ✓ matches cascade |
Why this probability
SMIC DUV 5nm at TSMC-class yield/economics is a steep structural leap; control moat persists. A base‑rate‑anchored prior, continuously scored against what actually happens — not a forecast.