What if collapsing on-chain yields trigger rapid stablecoin redemptions and reserve liquidation?
A collapse in on-chain yields triggers rapid redemption of stablecoins parked in DeFi for carry, forcing issuer reserve liquidation as balances flee.
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 6–18 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. 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. A collapse in on-chain yields triggers rapid redemption of stablecoins parked in DeFi for carry, forcing issuer reserve liquidation as balances flee. The trigger decomposes into signed root‑shocks — Bitcoin ▼ · Crypto confidence ▼ · Crypto liquidity ▼ · Real yields ▲ — 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 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -5.6% hist -3.22–-1.5% · other way -8.21% (n=12) |
| 2 | Ether ETHon Hyperliquid 📈 chart | Crypto | ▼ -4.6% hist -9.41–+0.67% · other way -7.55% (n=12) |
| 3 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▼ -3.3% hist -3.48–-0.34% · other way -16.24% (n=12) |
| 4 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▼ -3.1% hist -14.6–+0.65% · other way -5.09% (n=12) |
| 5 | Coinbase COINon Hyperliquid 📈 chart | Equity | ▼ -2.2% hist -2.0–+1.61% · other way -0.99% (n=12) |
| 6 | Hyperliquid (HYPE) HYPEon Hyperliquid | Crypto | ▼ -1.1% model prior · unmeasured |
| 7 | Tech sector XLK 📈 chart | Equity | ▼ -0.3% hist -0.39–+0.42% · other way -0.23% (n=12) |
| 8 | 30y Treasury yield DGS30 📈 chart | Rate | ▲ +3bp hist -3.46–+2.93% · other way -7.2% (n=12) |
| 9 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▼ -0.3% hist -1.46–+0.41% · other way +1.03% (n=12) |
| 10 | 10y Treasury yield DGS10 📈 chart | Rate | ▲ +3bp hist -0.57–+2.38% · other way -10.0% (n=12) |
| 11 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -0.2% hist -0.44–+0.1% · other way -0.31% (n=12) |
| 12 | Arm ARMon Hyperliquid 📈 chart | Equity | ▼ -0.2% hist -4.55–+3.87% · other way -8.58% (n=11) |
| 13 | Homebuilders XHB 📈 chart | Equity | ▼ -0.2% hist -0.48–+0.11% · other way -2.61% (n=12) |
Probable recommendation
Historical precedent — what analogous events actually did
Across 34 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 |
|---|---|---|---|---|---|---|
| Bitcoin BTC | SHORT | -10.8% · 5d -8.8% | 77% | 26 | 0.49 | ✓ matches cascade |
| SOL SOL | SHORT | -1.9% · 5d -11.9% | 74% | 19 | 0.40 | ✓ matches cascade |
| ETH ETH | SHORT | -6.5% · 5d -7.8% | 67% | 24 | 0.28 | ✓ matches cascade |
| Volatility VIX | LONG | +7.2% · 5d -0.9% ↺ fades | 66% | 32 | 0.28 | · |
| MSTR MSTR | SHORT | -0.4% · 5d -5.3% | 61% | 31 | 0.19 | ✓ matches cascade |
| US dollar DXY | LONG | +0.2% · 5d -0.0% ↺ fades | 62% | 34 | 0.19 | · |
| ARM ARM | SHORT | -4.7% · 5d -6.0% | 67% | 3 | 0.17 | ✓ matches cascade |
| Gold XAU | SHORT | -1.2% · 5d -1.1% | 58% | 31 | 0.14 | ✓ matches cascade |
| COIN COIN | LONG | +2.6% · 5d -2.5% ↺ fades | 58% | 19 | 0.13 | ⚠ differs |
| 30y yield DGS30 | SHORT | -5bp · 5d -2bp | 58% | 33 | 0.13 | ⚠ differs |
| High-yield credit HYG | LONG | +0.2% · 5d +0.2% | 58% | 31 | 0.13 | · |
| XLK XLK | LONG | +0.6% · 5d -0.7% ↺ fades | 55% | 31 | 0.07 | ⚠ differs |
| XHB XHB | SHORT | -0.4% · 5d -0.5% | 55% | 31 | 0.07 | ✓ matches cascade |
| NDX NDX | SHORT | -0.3% · 5d -1.6% | 52% | 33 | 0.02 | ✓ matches cascade |