Silver has fallen 17% in the past 24 hours, erasing a two-day rally as it struggles to find a bottom after last week’s historic plunge.
The move also dragged gold and copper lower, with traders saying the unwinding was exacerbated by thin liquidity and heavy speculative positioning.
A new wave of losses has also appeared on the cryptocurrency track. One of the larger liquidation prints related to tokenized silver on Hyperliquid was the forced liquidation of XYZ:SILVER of approximately $17.75 million, of which approximately $16.82 million came from long positions, according to trading data shared by market participants.
This uneven easing fits a recent pattern, in which traders tend to bet on a rally, only to be swept away when volatility spikes again.
This spillover effect is exactly what hedge fund manager Michael Burry pointed out earlier this week.
Burry described a “collateral death spiral” dynamic in which leverage increases as metal prices rise, and then cryptocurrency collateral declines forcing traders to sell tokenized metals to meet margin. He noted that losses in Bitcoin could force institutions to liquidate profitable metal positions.
In this case, the liquidation rankings may appear to be inverted, with the metal product briefly causing more damage than Bitcoin itself.
Macro headlines don’t help. Markets are still digesting the policy implications of Kevin Warsh’s nomination as Fed chair, while President Donald Trump has pushed back against the idea that the central bank could become more hawkish.
Rate expectations are important for precious metals, but the bigger driver right now is positioning and forced selling rather than the clean macro buying that drove last month’s price surge.