What if a G7 reserve seizure triggers flight from US assets?
A G7 reserve seizure triggering flight is a confidence-and-geopolitical shock, so the trade is the long end selling (30y +10bp) with gold (+3%) and bitcoin bid and DXY down, plus a VIX bump — reserve managers reprice the safety of USD assets. Direct rhyme is the Feb 2022 freezing of Russian central-bank reserves, which catalyzed the global central-bank gold-buying wave. Forward angle: each seizure raises the perceived political risk of holding USTs for non-aligned sovereigns, so gold and bitcoin are the structural beneficiaries even if the dollar holds short-term.
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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 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. The G7 seizes a major sovereign's reserves, triggering reserve flight out of USD assets. The trigger decomposes into signed root‑shocks — Dollar/reserve confidence ▼ · Geopolitical risk ▲ — which propagate through our causal graph to the markets below.