Moody’s Analytics has identified a cryptocurrency market crash as one of the most probable economic shocks for the next 12 to 18 months. The firm’s latest risk matrix, presented by chief economist Mark Zandi, evaluates 27 potential threats based on their likelihood and economic impact.
While the report places a crypto crash high on the probability scale, Moody’s expects the broader economic damage to remain relatively limited. The analysis highlights that high borrowing costs currently weigh on speculative assets, and a potential stock market selloff could trigger further pressure on digital currencies through forced liquidations.
The firm also highlighted four more significant threats to global markets: an AI stock selloff, escalating conflict in Iran, bond market instability, and potential policy errors by the Federal Reserve. Bond markets are already under pressure, with the US 10-year Treasury yield recently hitting 5.31 percent before dropping to 4.99 percent.
Investors are closely watching the Federal Reserve’s upcoming interest rate decision scheduled for October 28. Following the September rate hike to a range of 3.75–4 percent, market participants currently estimate only a 10.5 percent probability of another rate increase this month, according to data from CME FedWatch.
