Digital asset markets present tail risk profiles that can differ structurally from those in traditional finance. Drawdowns can compound across protocols within minutes, and the mechanisms that drive them are often endogenous to the system itself. For institutions allocating capital onchain, understanding how these events propagate is a precondition for disciplined risk management.

This webinar examines the mechanisms that drive crypto tail exposure. Liquidation cascades, correlation breakdowns, liquidity evaporation, reflexivity, hidden leverage, and convexity can require intricacy that conventional risk models don't cover. These mechanisms can amplify losses during periods of stress, and many of them are specific to the design of onchain markets.

So while quantitative frameworks built for traditional asset classes share conceptual overlap with digital assets, their structural differences run deep enough that a naive mapping quickly reaches its limits, leaving critical dynamics unaccounted for. The session examines where these models hold up, where they break down, and what adjustments are needed to keep their outputs meaningful under onchain conditions.

The discussion then turns to the practical work of building institutional risk infrastructure for digital assets, walking through how structured stress testing can be applied to DeFi positions, including the design of scenarios that capture protocol-specific dynamics alongside broader market shocks.

The objective is a clearer picture of how institutions can prepare for extreme events in digital asset markets, and how the tools and processes developed for those events should shape day-to-day allocation, exposure management, and governance.