we will see the reduction in the USD vs BTC exchange rate
The thing is there is a point where the jelly mould gets turned upside down and the impossible happens, the liquid has become a solid and everything is reversed. It is possible, as unlikely as it seems for BTC to rise in an extreme case of instability.
People say if deflation they will print money, well they already have done that. That liquidity is mostly stored in bonds now and the USA has one of the lowest average turnovers in its debt in the world. I think its about 4 years. Why would that be? well its cheaper.
If you fix a rate for many years, it rises to account for unknown and short term to borrow we know the rate goes as low as zero almost. So its been policy to hold 17 trillion or so on very tight turnaround.
The other people who did this were the banks in 2008, including Lehmans; if they had financed 20 year even 10 year bonds as their debt they'd operating now I think. But gov is special right? no not in the end.
So the question is flawed, not stock sell off, bond sell off. Forex > Bond > Shares > BTC Thats the order and trillions are held in bonds and you know its trillions because that debt is a populations burden, not nearly as much is held as shares and its mostly private debt. They just go broke, a stock crash is not the dam breaking you might think it is
The big deal is and afaik always has been debt financing and interest rates, if that breaks down as well it might then BTC can rise substantially and personally I think it will ( so long as the network stays true till then)
If you look at the triangle, diamonds are quite high up. Would BTC rise if diamonds had a price crash ? Not really a comparable substitute or necessary with other levels stable. But each level you go lower it gets more serious if it fails and the possibility for BTC to come of age and prove itself becomes greater, can it be useful and reliable or not
The chart was made by the Fed before they joined the dark side :p