Silver experienced its steepest one-day drop since 1980, plunging over 32% and erasing approximately $2.5 trillion in market value.
This sharp decline was intensified by the CME Group's decision to raise margin requirements for silver futures from 11% to 15% for standard accounts and up to 16.5% for high-risk profiles, forcing many traders to liquidate their positions.
In the midst of this turmoil, JPMorgan Chase & Co. issued 633 silver delivery notices at the crash's lowest settlement price of $78.29, effectively closing short positions totaling 3.17 million ounces.
Given JPMorgan's previous $920 million fine in 2020 for manipulating precious metals markets through spoofing between 2008 and 2016, their recent actions have raised concerns about potential market influence.
Notably, while U.S. silver prices collapsed, physical silver in Shanghai continued trading at a significant premium, indicating that the crash was driven more by leveraged paper trading than by actual supply and demand dynamics.
This event underscores the vulnerabilities in a market dominated by paper contracts and highlights the advantages held by large institutions with substantial capital reserves.
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