What if a stablecoin redemption wave triggers a Treasury-bill fire sale?
A multi-billion stablecoin redemption forcing rapid T-bill liquidation jolts the front end and breaks crypto first — ETH and BTC gap as the on-chain dollar plumbing wobbles. Rhymes with the March-2023 USDC depeg (Circle's SVB exposure), when USDC hit $0.87 and ETH/BTC sold off until the banking backstop. Forward angle: Tether/Circle reserves are now large enough that a forced bill sale is a genuine front-end event — watch bill yields and the basis, not just the coin's peg.
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 0–6 months 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 multi-billion stablecoin redemption wave forces rapid liquidation of its Treasury-bill reserves, jolting the front end of the curve. The trigger decomposes into signed root‑shocks — Crypto confidence ▼ · Fed policy path ▲ · Financial conditions ▲ — which propagate through our causal graph to the markets below.