JPMorgan Chase turns against Wall Street: hoarding silver, positioning for gold, shorting the dollar credit

Original Author: sleepy.txt, Dongcha Beating

JPMorgan Chase, the most loyal "gatekeeper" of the old dollar order, is personally tearing down the high walls it once vowed to defend.

According to market rumors, by the end of November 2025, JPMorgan Chase will relocate its core precious metals trading team to Singapore. If the geographical migration is merely superficial, its essence is a public defection from the Western monetary system.

Looking back over the past half century, Wall Street has been responsible for constructing a massive illusion of credit with the dollar, while London, as the "heart" of Wall Street's monetary empire across the Atlantic, has maintained the dignity of pricing with its deep underground vaults. The two have intertwined, weaving an absolute control network over precious metals in the Western world. And JPMorgan Chase was supposed to be the last and most solid line of defense.

In silence, as the official response to the rumors remained noncommittal, JPMorgan Chase completed a stunning asset maneuver, quietly moving approximately 169 million ounces of silver from the "deliverable" category in the COMEX vault to the "non-deliverable" category. According to rough calculations based on publicly available data from the Silver Institute, this roughly corresponds to nearly 10% of the global annual supply, effectively locked away on the books.

In the brutal commercial game, scale itself is the toughest attitude. This mountain of over 5,000 tons of silver appears to many traders as JPMorgan Chase's prepared chips for competing for pricing power in the next cycle.

Meanwhile, thousands of kilometers away, Singapore's largest private vault, The Reserve, has timely launched its Phase II project, raising the total capacity of the vault to a staggering 15,500 tons. This infrastructure upgrade, planned five years ago, gives Singapore enough confidence to absorb the massive wealth flowing out of the West.

JPMorgan Chase is locking down the liquidity of physical assets in the West with its left hand, creating panic; while with its right hand, it is building a reservoir in the East to reap the benefits.

What prompted this giant's defection is the undeniable fragility of the London market. At the Bank of England, the delivery period for gold has been extended from a few days to several weeks, while the leasing rate for silver has soared to a historic high of 30%. For those familiar with this market, this at least indicates one thing: everyone is scrambling for goods, and the physical assets in the vaults are beginning to show signs of strain.

The shrewdest players are often the most sensitive vultures to the scent of death.

In this harsh winter, JPMorgan Chase has demonstrated the instincts of a top player. Its exit marks the imminent end of the "paper gold" game that has lasted half a century, turning stone into gold. When the tide goes out, only those holding heavy physical chips can secure a ticket to the next thirty years.

The End of Alchemy

The root of all troubles was sown half a century ago.

In 1971, when President Nixon severed the dollar's tie to gold, he effectively pulled out the last anchor of the global financial system. From that moment on, gold was downgraded from a rigidly redeemable currency to a financial asset redefined by Wall Street.

In the following half-century, bankers in London and New York invented a sophisticated "financial alchemy." Since gold was no longer currency, it could be conjured up like printing money, creating countless contracts representing gold out of thin air.

This is the vast derivatives empire established by the LBMA (London Bullion Market Association) and COMEX (New York Mercantile Exchange). In this empire, leverage is king. Every ounce of dormant gold in the vault corresponds to 100 delivery orders circulating in the market. And at the silver table, this game is even crazier.

This "paper wealth" system has been able to operate for half a century, entirely relying on a fragile gentleman's agreement: the vast majority of investors are only in it for the price difference and should never attempt to withdraw that heavy metal.

However, the designers of this game overlooked a "gray rhino" charging into the room—silver.

Unlike gold, which is buried deep underground as eternal wealth, silver plays the role of a "consumable" in modern industry. It is the lifeblood of photovoltaic panels and the nerves of electric vehicles. According to the Silver Institute, the global silver market has been in structural deficit for five consecutive years, with industrial demand accounting for nearly 60% of total demand.

Wall Street can type out infinite dollars on a keyboard, but it cannot conjure up an ounce of silver for conductivity.

When physical inventories are devoured by the real economy, the billions of contracts on paper become a tree without roots. By the winter of 2025, this thin veneer of illusion was finally pierced.

The first red flag was the price anomaly. In normal futures logic, forward prices are usually higher than spot prices, known as a "contango." But in London and New York, the market experienced extreme "spot premiums." If you wanted to buy a silver contract for six months later, it was a peaceful time; but if you wanted to take home silver bars now, you not only had to pay a high premium but also face a long wait of several weeks.

Long lines formed outside the Bank of England's vault, and COMEX's registered silver inventory fell below the safety threshold, with the ratio of open contracts to physical inventory soaring to 244%. The market finally understood the terrifying reality: physical assets and paper contracts were splitting into two parallel universes. The former belongs to those who own factories and vaults, while the latter belongs to speculators still lost in old dreams.

If the shortage of silver is due to the consumption of industrial giants, then the loss of gold is due to a national-level "run." Central banks, once the most steadfast holders of dollars, are now at the forefront of the run.

Although gold prices in 2025 are at historical highs, causing some central banks to slow their purchasing speed tactically, strategically, "buying" remains the only action. The World Gold Council (WGC) recently reported that in the first ten months of 2025, global central banks net purchased a total of 254 tons of gold.

Let's take a look at this list of buyers.

Poland, after pausing gold purchases for five months, suddenly re-entered the market in October, buying 16 tons in a single month, forcing its gold reserves to account for 26%. Brazil has increased its holdings for two consecutive months, raising its total reserves to 161 tons. China has appeared on the buyer's list for the 13th consecutive month since resuming purchases in November 2024.

These countries are willing to exchange precious foreign exchange for heavy gold bars and bring them back home. In the past, everyone trusted U.S. Treasuries because they were "risk-free assets"; now, everyone is scrambling for gold because it has become the only shelter against "dollar credit risk."

Despite Western mainstream economists still arguing that the paper gold system provides efficient liquidity and that the current crisis is merely a temporary logistics issue.

But paper cannot contain fire, and now paper cannot contain gold either.

When the leverage ratio reaches 100:1, and that lone "1" begins to be resolutely brought back home by central banks, the remaining "99" paper contracts face unprecedented liquidity mismatches.

The current London market is caught in a typical short squeeze, with industrial giants busy scrambling for silver to maintain production, while central banks are tightly locking up gold as a national fortune reserve. When all trading counterparts demand physical delivery, the pricing models based on credit foundations become ineffective. Whoever holds the physical assets holds the power to define prices.

And JPMorgan Chase, once the master of manipulating paper contracts, clearly saw this future earlier than anyone else.

Rather than being a martyr of the old order, it prefers to be a partner in the new order. This habitual offender, which has been fined $920 million for market manipulation over the past eight years, is leaving not out of a sudden conscience but as a precise bet on the direction of global wealth flow for the next thirty years.

What it is betting on is the collapse of the "paper contract" market. Even if it does not collapse immediately, that layer of infinitely magnified leverage will eventually be cut down time and again. The only thing truly safe is the tangible metal in the vault.

Betraying Wall Street

If we compare the paper gold and silver system to a glitzy casino, then over the past decade, JPMorgan Chase has not only been the bodyguard maintaining order but also the dealer most skilled at cheating.

In September 2020, to settle the U.S. Department of Justice's allegations of manipulating the precious metals market, JPMorgan Chase paid a record $920 million in settlement. In the thousands of pages of investigative documents disclosed by the Department of Justice, JPMorgan Chase's traders were described as masters of deception.

They commonly employed a very cunning hunting technique, where traders would instantly post thousands of contracts on the sell side, creating the illusion that prices were about to collapse, inducing retail investors and high-frequency robots to panic sell; then, at the moment of the collapse, they would withdraw their orders and buy back the bloodied chips at the bottom.

According to statistics, Michael Nowak, JPMorgan Chase's former global head of precious metals, and his team artificially created moments of price collapse and surges in gold and silver thousands of times over eight years.

At the time, the outside world generally attributed all of this to Wall Street's usual greed. But five years later, when that 169 million ounces of silver inventory puzzle piece was placed on the table, a darker idea began to circulate in the market.

In some interpretations, JPMorgan Chase's "manipulations" back then can hardly be seen as merely aiming to earn a little more from high-frequency trading spreads. It seems more like a slow and prolonged accumulation of positions, where they violently suppressed prices in the paper market, creating the illusion of prices being held down; while on the physical side, they quietly collected the chips for themselves.

This former guardian of the old dollar order has now transformed into the most dangerous grave digger of that old order.

In the past, JPMorgan Chase was the largest short seller of paper silver, the ceiling on suppressing gold and silver prices. But now, with the physical chips replaced, they have overnight become the largest long position.

Market gossip has never been in short supply, with rumors suggesting that the recent surge in silver prices from $30 to $60 is being driven by JPMorgan Chase itself. While such claims lack evidence, they are enough to indicate one thing: in the minds of many, it has transformed from a short seller of paper silver to the largest long position in physical assets.

If all of this holds true, we will witness the most spectacular and ruthless coup in commercial history.

JPMorgan Chase knows better than anyone that the iron fist of U.S. regulation is tightening inch by inch, and that game of paper contracts, which could cost not just money but possibly lives, has reached its end.

This also explains why it is so fond of Singapore.

In the U.S., every transaction could be flagged as suspicious by AI regulatory systems; but in Singapore, in those private fortresses not belonging to any central bank, gold and silver are completely depoliticized. There is no long-arm jurisdiction here, only extreme protection of private property.

JPMorgan Chase's breakout is by no means a solitary battle.

At the same time that the rumors were fermenting, a top-level consensus on Wall Street has quietly formed. Although there has been no physical collective relocation, strategically, the giants have achieved an astonishing synchronized shift, with Goldman Sachs aggressively setting a gold price target of $4,900 for 2026, and Bank of America even directly calling for a sky-high $5,000.

In the era dominated by paper gold, such target prices sounded like a fantasy; but if we shift our perspective to physical assets, looking at the pace of central bank gold purchases and changes in vault inventories, this number begins to have space for serious discussion.

Smart money on Wall Street is quietly repositioning, reducing gold shorts and increasing physical positions. While they may not completely dump their U.S. Treasuries, gold, silver, and other physical assets are gradually being stuffed into their portfolios. JPMorgan Chase's actions are the fastest and most decisive, as it not only wants to survive but also to win. It does not want to sink with the paper gold empire; it wants to take its algorithms, capital, and technology to a place that not only has gold but also has a future.

The problem is that that place already has its own master.

When JPMorgan Chase's private jet lands at Singapore's Changi Airport, looking north, it will find a larger opponent that has already built high walls there.

Waves and Currents

While traders in London are still anxious about the liquidity depletion of paper gold, thousands of kilometers away on the banks of the Huangpu River in Shanghai, a massive physical gold empire has already completed its primitive accumulation.

Its name is the Shanghai Gold Exchange (SGE).

In the Western-dominated financial landscape, SGE is a complete outlier. It rejects the virtual games based on credit contracts found in London and New York, and from its inception, it has adhered to an almost paranoid iron rule: physical delivery.

These four words are like a steel nail, precisely driven into the seven inches of the Western paper gold game.

At New York's COMEX, gold is often just a string of fluctuating numbers, with the vast majority of contracts being closed before expiration. But in Shanghai, the rules are "full transaction" and "centralized clearing."

Every transaction here must have real gold bars lying in the vault behind it. This not only eliminates the possibility of infinite leverage but also raises the threshold for "shorting gold" significantly, as you must first borrow real gold to sell it.

In 2024, SGE delivered an astonishing report card, with annual gold trading volume reaching 62,300 tons, a 49.9% increase from 2023; trading value soared to 34.65 trillion yuan, an increase of nearly 87%.

When the physical delivery rate at New York's COMEX is less than 0.1%, the Shanghai Gold Exchange has become the world's largest reservoir of physical gold, continuously absorbing global stockpiles of gold.

If the influx of gold represents a country's strategic reserves, then the influx of silver represents China's "physiological thirst" for industry.

Wall Street speculators can use paper contracts to bet on prices, but as the world's largest photovoltaic and new energy manufacturing base, Chinese factory owners do not want contracts; they must obtain real silver to start production. This rigid industrial demand has made China the world's largest precious metals black hole, continuously devouring Western stockpiles.

This "West-to-East gold shift" is busy and secretive.

Take the journey of a gold bar as an example. In Switzerland's Ticino region, the world's largest gold refineries (such as Valcambi and PAMP) are operating day and night. They are executing a special "blood exchange" task, melting and purifying 400-ounce standard gold bars transported from London, then recasting them into 1-kilogram bars with a purity of 99.99%, known as "Shanghai Gold."

This is not only a physical transformation but also a change in monetary attributes.

Once these gold bars are melted into 1-kilogram specifications and stamped with the "Shanghai Gold" mark, they are almost impossible to flow back to the London market. Because to send them back, they must be melted and certified again, which is extremely costly.

This means that once gold flows eastward, it is like river water flowing into the sea, with no turning back. Waves and currents, the endless river flows never cease.

At major airports around the world, armored convoys bearing the logos of Brink's, Loomis, or Malca-Amit are the transporters of this great migration. They continuously fill Shanghai's vaults with these recast gold bars, becoming the physical cornerstone of the new order.

Whoever holds the physical assets holds the power of discourse. This is precisely the strategic significance that Yu Wenjian, the head of SGE, repeatedly emphasizes in establishing a "Shanghai Gold" benchmark price.

For a long time, the global gold pricing power has been firmly locked in the London afternoon fix at 3 PM, as it reflects the will of the dollar. But Shanghai is attempting to sever this logic.

This is a high-dimensional strategic hedge. As countries like China, Russia, and those in the Middle East begin to form an invisible alliance for "de-dollarization," they need a new common language. This language is neither the yuan nor the ruble, but gold.

Shanghai is the translation center for this new language. It is telling the world that if the dollar is no longer trustworthy, then please trust the real gold and silver stored in your own warehouses; if paper contracts may default, then please trust the Shanghai rules of cash on delivery.

For JPMorgan Chase, this is both a huge threat and an opportunity that cannot be ignored.

To the west, it can no longer return, as there is only depleted liquidity and tightening regulation; to the east, it must face the behemoth that is Shanghai. It cannot directly conquer Shanghai, as the rules there do not belong to Wall Street, and the walls are too thick.

The Last Buffer Zone

If Shanghai is the "heart" of the Eastern physical asset empire, then Singapore is the "front line" in this East-West confrontation. It is not just a geographical transit point but also the last carefully selected line of defense for Western capital in the face of the rise of the East.

Singapore, this city-state, is investing almost fanatically to transform itself into the "Switzerland" of the 21st century.

Located next to Changi Airport's runway, Le Freeport is the best window to observe Singapore's ambitions. This freeport, with independent judicial status, is a perfect "black box" in both physical and legal terms. Here, the flow of gold is stripped of all cumbersome administrative regulations, with the entire process from the plane landing to gold bars entering the vault completed in a completely closed, duty-free, and highly private loop.

Meanwhile, another super vault named The Reserve has been on high alert since 2024. This fortress, covering 180,000 square feet, has a total designed capacity of up to 15,500 tons. Its selling point is not only the one-meter-thick reinforced concrete walls but also a privilege granted by the Singapore government—complete exemption from Goods and Services Tax (GST) on investment-grade precious metals (IPM).

For market makers like JPMorgan Chase, this is an irresistible temptation.

However, if it were merely about taxes and vaults, JPMorgan Chase could have chosen Dubai or Zurich. Its ultimate choice of Singapore hides deeper geopolitical calculations.

In Wall Street, directly moving the core business from New York to Shanghai is akin to "defection," which would be suicidal in the current unpredictable international political climate. They urgently need a fulcrum, a safe harbor that can reach the vast physical market of the East while providing political security.

Singapore is the unequivocal choice.

It guards the Strait of Malacca, connecting London's dollar liquidity while reaching the physical demands of Shanghai and India.

Singapore is not just a safe harbor; it is the largest transit hub connecting two divided worlds. JPMorgan Chase is attempting to establish a sunless trading loop here: fixing prices in London, hedging in New York, and stockpiling in Singapore.

However, JPMorgan Chase's calculations are not without flaws. In the competition for pricing power in Asia, it cannot avoid a formidable opponent—Hong Kong.

Many mistakenly believe that Hong Kong has fallen behind in this round of competition, but the reality is quite the opposite. Hong Kong possesses a core trump card that Singapore cannot replicate: it is the only channel for the yuan to go abroad.

Through the "Gold Connect" program, the Hong Kong Gold and Silver Exchange (CGSE) is directly connected to the Shanghai Gold Exchange. This means that gold traded in Hong Kong can directly enter the delivery system of mainland China. For those truly wanting to embrace the Chinese market, Hong Kong is not "offshore," but an "onshore" extension.

JPMorgan Chase chose Singapore, betting on a "dollar + physical" hybrid model, attempting to establish a new offshore center on the ruins of the old order. Meanwhile, traditional British banks like HSBC and Standard Chartered continue to heavily invest in Hong Kong, betting on the future of "yuan + physical."

JPMorgan Chase believes it has found a neutral safe harbor, but in the geopolitical meat grinder, there is never a true "middle ground." Singapore's prosperity is essentially a result of the overflow of Eastern economies. This seemingly independent luxury yacht has long been locked in the gravitational field of the Eastern continent.

As Shanghai's gravitational pull grows stronger, as the landscape of yuan-denominated gold expands, and as China's industrial machine continuously devours the physical silver on the market, Singapore may no longer be a neutral safe harbor, and JPMorgan Chase will have to make another fateful choice.

The Reboot of the Cycle

The rumors about JPMorgan Chase may eventually receive an official explanation, but that no longer matters. In the business world, keen capital always senses the tremors of the earth's crust first.

The source of this tremor is not in Singapore but deep within the global monetary system.

For the past fifty years, we have been accustomed to a "paper contract" world dominated by dollar credit. That was an era built on debt, promises, and the illusion of infinite liquidity. We once thought that as long as the printing presses were running, prosperity could be perpetual.

But now, the winds have completely changed.

As central banks spare no expense to repatriate gold, and as global manufacturing giants begin to worry about securing the last piece of industrial silver, we see a return of an ancient order.

The world is slowly but firmly returning from the ethereal credit monetary system to a tangible asset system. In this new system, gold is the measure of credit, and silver is the measure of production capacity. One represents the bottom line of safety, while the other represents the limits of industry.

In this long migration, London and New York are no longer the only endpoints, and the East is no longer just a simple manufacturing factory. New game rules are being established, and new power centers are forming.

The era defined by Western bankers in valuing gold and silver is slowly fading away. Gold and silver remain silent but answer all questions about the times.

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