What if China launches a full invasion of Taiwan?
A full amphibious assault is the semis tail: losing TSMC's leading-edge node is non-substitutable, so the -6% TSMC / -9% Nasdaq / +20 VIX cascade is directionally right and arguably understates a true fab-destruction scenario. No clean modern analogue; 1990 Iraq/Kuwait oil shock is the nearest war-premium template, but chips lack oil's spare capacity. Transmission: Japan, Korea, and US fabless all seize up. The forward risk is gold and defense names being the only green on the screen.
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 risk-off shock. PLA launches amphibious and airborne assault across the strait, triggering US treaty-ambiguity crisis and Pacific war. The trigger decomposes into signed root‑shocks — Geopolitical risk ▲ · Risk appetite ▼ · Semiconductor supply risk ▲ — 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 | Volatility (VIX) VIXon Hyperliquid 📈 chart | Vol | ▲ +20.0% hist +3.52–+15.59% · other way -2.31% (n=12) |
| 2 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▼ -8.9% hist -4.25–-2.16% · other way -0.05% (n=12) |
| 3 | Semiconductors SMHon Hyperliquid 📈 chart | Equity | ▼ -5.7% hist -3.43–-1.84% · other way +1.4% (n=12) |
| 4 | Tech sector XLK 📈 chart | Equity | ▼ -6.2% hist -3.75–-2.05% · other way +0.37% (n=12) |
| 5 | TSMC TSMon Hyperliquid 📈 chart | Equity | ▼ -5.7% hist -4.73–-1.15% · other way +1.64% (n=12) |
| 6 | Nvidia NVDAon Hyperliquid 📈 chart | Equity | ▼ -5.3% hist -3.63–-1.28% · other way +4.13% (n=12) |
| 7 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▼ -4.9% hist -4.18–-1.27% · other way +1.35% (n=12) |
| 8 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -5.0% hist -4.49–+1.6% · other way +8.12% (n=12) |
| 9 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▼ -4.5% hist -9.61–+0.65% · other way -17.76% (n=11) |
| 10 | ASML ASMLon Hyperliquid 📈 chart | Equity | ▼ -3.9% hist -5.22–-0.04% · other way -0.91% (n=12) |
| 11 | Hyperliquid (HYPE) HYPEon Hyperliquid | Crypto | ▼ -3.4% model prior · unmeasured |
| 12 | AMD AMDon Hyperliquid 📈 chart | Equity | ▼ -3.7% hist -2.09–-1.05% · other way -2.72% (n=12) |
| 13 | Broadcom AVGOon Hyperliquid 📈 chart | Equity | ▼ -3.7% hist -2.58–+0.88% · other way +5.76% (n=12) |
| 14 | Micron MUon Hyperliquid 📈 chart | Equity | ▼ -3.7% hist -4.98–-0.06% · other way -1.7% (n=12) |
Probable recommendation
Why we may diverge from history
Trust the cascade short on MSTR/JPM/XLF: analogues are tariff and Wagner-mutiny risk-on bounces during a BTC bull, not Pacific war — full Taiwan invasion is a structural break no 2024-25 window captures.
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 |
|---|---|---|---|---|---|---|
| ETH ETH | SHORT | -7.7% · 5d -4.8% | 76% | 24 | 0.37 | ✓ matches cascade |
| CNY CNY | SHORT | -0.5% · 5d -0.3% | 67% | 29 | 0.32 | ✓ matches cascade |
| Bitcoin BTC | SHORT | -5.2% · 5d -3.1% | 68% | 27 | 0.28 | ✓ matches cascade |
| Volatility VIX | LONG | +6.0% · 5d +4.0% | 65% | 31 | 0.27 | ✓ matches cascade |
| NDX NDX | SHORT | -0.4% · 5d -1.2% | 68% | 33 | 0.26 | ✓ matches cascade |
| SOL SOL | SHORT | -6.7% · 5d -6.8% | 70% | 20 | 0.26 | ✓ matches cascade |
| AUD AUD | SHORT | -0.6% · 5d -0.4% | 63% | 28 | 0.22 | ✓ matches cascade |
| KRW KRW | LONG | +0.1% · 5d -0.3% ↺ fades | 61% | 28 | 0.20 | ⚠ differs |
| MU MU | SHORT | -2.9% · 5d -3.4% | 61% | 33 | 0.18 | ✓ matches cascade |
| AMD AMD | SHORT | -0.2% · 5d -1.7% | 61% | 34 | 0.17 | ✓ matches cascade |
| Gold XAU | LONG | +1.1% · 5d -0.6% ↺ fades | 61% | 29 | 0.17 | ✓ matches cascade |
| INTC INTC | SHORT | -2.8% · 5d -1.7% | 59% | 34 | 0.17 | ✓ matches cascade |
| NVDA NVDA | SHORT | -0.9% · 5d -3.7% | 61% | 29 | 0.15 | ✓ matches cascade |
| AVGO AVGO | LONG | +2.3% · 5d -2.0% ↺ fades | 57% | 28 | 0.14 | ⚠ differs |
Why this probability
Full amphibious invasion is rare, enormously costly; base rate near-zero, 1-3yr too short. A base‑rate‑anchored prior, continuously scored against what actually happens — not a forecast.