The anticipated upward momentum of the so-called "Hard Asset Super-Cycle" for 2025 encountered a notable disruption on Monday, as a constellation of factors combined to trigger a pronounced correction across key metals markets. Profit-taking by investors nearing year-end, coupled with a dampening of geopolitical tensions—most notably due to hopeful progress in Russia-Ukraine peace discussions—fueled retreats in prices of several prominent metals. This environment was further complicated by widespread but unverified rumors circulating on social media about a significant margin call related to silver, which appeared to exacerbate market anxiety, particularly impacting silver instruments such as the iShares Silver Trust (NYSE:SLV).
Examining the price movements in detail, gold surrendered approximately 4.5%, retreating to a level close to $4,345 per ounce after recently touching an all-time peak near $4,550. This decline was mirrored in related exchange-traded products, with the SPDR Gold Shares ETF (NYSE:GLD) falling about 4.4%. Similarly, copper prices eased around 4% settling at roughly $5.54 per pound ($12,421 per tonne), a pullback from the prior approach toward the psychologically critical $13,000 per tonne threshold. This downturn extended to equities tied to copper, such as the Global X Copper Miners ETF (NYSE:COPX), which declined 4% on the day.
Silver, however, endured even more pronounced volatility. After an overnight peak nearing $83.62 per ounce, the metal suffered a "flash crash," plummeting close to 11% to trade within the $71 to $73 range. Correspondingly, shares of the iShares Silver Trust saw a near 9% decline. The platinum market followed a similar trajectory, experiencing one of the steepest drops, with prices falling over 14% to rest near $2,180 per ounce and the Abrdn Physical Platinum Shares ETF (NYSE:PPLT) decreasing by 13.5%.
Market analysts attribute this broad downturn, dubbed "red Monday," to several converging factors: investors engaging in year-end selling to realize gains; the strengthening of the U.S. Dollar Index, which typically exerts downward pressure on dollar-denominated commodities; and increased investor optimism about easing military conflict, which reduces the allure of metals as safe-haven assets.
In parallel to these market movements, social media venues such as X and Reddit—specifically communities like r/WallStreetSilver—amplified rumors concerning a dramatic event in silver trading: an alleged failure of a "systemically important" bank to meet a $2.3 billion margin call during the recent price spike toward $84 per ounce. Reports claimed this institution was forcibly liquidated by an exchange at approximately 2:47 AM on December 29. The rumor also posited that, as a result, the Federal Reserve injected emergency liquidity ranging from $17 billion to as much as $34 billion into the repo market to avert a systemic contagion.
Tracing the origin of this rumor reveals connections to fringe news sources known for promoting unverified or conspiratorial financial narratives. One Reddit user shared what was purported to be the initial account of the event, which quickly attracted significant attention and discussion among retail investors. Additionally, separate commentary on X suggested the Federal Reserve's Emergency Overnight Repo Facility had facilitated a $34 billion infusion. While data confirms increased Fed repo operations, the scale indicated in the rumor substantially exceeds actual volumes.
The banks cited in these accounts—including JPMorgan Chase & Co. (NYSE:JPM), HSBC Holdings Plc (NYSE:HSBC), and UBS Group AG (NYSE:UBS)—are often spotlighted in discussions about "silver squeeze" scenarios. They frequently maintain substantial short positions in silver, utilized either for hedging physical holdings or fulfilling market-making functions. With silver appreciating over 150% year-to-date in 2025, theories have proliferated asserting severe losses on these short positions.
However, financial experts emphasize that even hypothetically significant losses—estimated at around $7 billion for a major bank—would remain manageable for large institutions such as UBS or JPMorgan, given their extensive holdings of high-quality liquid assets (HQLA) worth hundreds of billions. Efforts to obtain comment from these banks on the rumors were unsuccessful at the time of reporting.
Overall, while the metals complex faces tangible headwinds driven by profit-taking, currency shifts, and political developments, the gravity of financial systemic risks invoked by social media conjecture remains unsubstantiated. Investors are advised to interpret ongoing market fluctuations with caution, waiting for verified information before adjusting strategic positions.