What if a run on Tether forces it to dump $120bn of Treasury bills?
A confidence run on Tether forces redemption of its ~$120bn reserve, dumping Treasury bills at roughly +6–8bp per ~$3.5bn outflow and spiking short-end yields per the Fed FEDS Note on stablecoin reserve mechanics.
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 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. Loading the probability audit trail…
What it would mean
If this plays out, it is a mixed shock. A confidence run on Tether forces redemption of its ~$120bn reserve, dumping Treasury bills at roughly +6–8bp per ~$3.5bn outflow and spiking short-end yields per the Fed FEDS Note on stablecoin reserve mechanics. The trigger decomposes into signed root‑shocks — Crypto confidence ▼ · Crypto liquidity ▼ · Financial conditions ▲ · Real yields ▲ — which propagate through our causal graph to the markets below.