It happened: The Greek people voted Sunday against the last major bailout package the European establishment had offered it, throwing its future within the eurozone in jeopardy. The result was a big victory for Prime Minster Alexis Tsipras, the leftist firebrand who lead the Syriza party to victory at the beginning of the year.
And although U.S. futures sold off initially overnight, word that Greek Finance Minister Yanis Varoufakis had resigned on Tsipras' request boosted sentiment and has mostly contained the fallout on Wall Street in Monday's trading.
Varoufakis, who had led the Greek resistance against Europe's austerity demands, marched triumphantly through the streets of Athens after the referendum results and called the European establishment "terrorists" for freezing liquidity support of Greece's banks. He had become the face of Greek intransigence.
His departure, however, hasn't changed the situation's dynamics -- and time is running short.
What happens next in Greece largely depends on the action of the European Central Bank and whether it increases, holds steady or cuts its liquidity support for Greek banks. They were closed all last week after Sunday's referendum was announced last weekend and the ECB froze its level of support.
Reuters is reporting that the banks will stay closed at least until Friday, but grocery shelves are already growing bare and businesses are on the verge of shutting down as supply chains are disrupted. Greek depositors holding large balances -- unable to transfer money out of the country or withdraw more than $66 dollars from ATMs per day -- are at risk of a "bail in" (read "loss") of at least 30 percent on deposits above $8,800 according to the Financial Times.
Greek leaders claimed the referendum result would bring them back to the negotiating table in search of a deal featuring debt relief, which is what the country really needs to get back on its feet. A new study by the International Monetary Fund -- with the support of U.S. officials -- gave backing to this demand as the institution turned against the Eurogroup consensus.
Specifically, the IMF has said the eurozone will need to provide Greece with at least $55 billion in funding over the next three years and a debt write-down of 30 percent to achieve debt sustainability targets set in 2012. At a minimum, this could be achieved by lengthening the maturity of existing obligations, lowering the present value of those debts and lightening the beleaguered Greek economy's repayment load.
But the voters in core eurozone countries like Germany are increasingly frustrated with the situation and are not happy with the idea of paying to let Greece off the hook. Especially given the origins of this crisis, such as overspending on defense in the 1980s, hidden debts covered up with the help of Wall Street and a national pastime of tax avoidance and economic corruption.
The initial reaction to the over-the-weekend vote is not looking favorable, with the Eurogroup of finance ministers scheduled to discuss new bailout options for Greece on Tuesday. A Greek exit from the currency union is a rising possibility.
Analysts at JPMorgan see a "Grexit' and Eurogroup split in the coming days, with a Greek departure from the euro their "base case" after the vote.
Ultimately, what happens comes down to a race between two forces. In the JPMorgan analysts' words, it's "political pressure to move toward an agreement despite resistance from a number of northern European parliaments, versus the increasingly unpleasant implications of a dysfunctional banking system on the other."
If a stalemate persists, the next big deadline will be a $3.8 billion payment to the ECB on July 20. A default on this by Greece would likely force the ECB to pull back its liquidity support, force Greece to issue California-style IOUs and start the process of restoring the drachma.