The crypto market's tight links with traditional markets laid bare Friday as a sharp slide in metal prices shook out millions in leveraged bets on blockchain versions of gold, silver, and copper.

Three-month copper futures on the London Metal Exchange (LME) fell nearly 4% from Thursday’s peak above $14,500 a ton, settling closer to $13,000 amid technical disruptions at the LME, and a sharp shift in positioning by Chinese traders. The move marked a pause after a relentless run driven by Chinese demand, energy transition optimism and a weaker U.S. dollar.

Gold and silver prices fell by 4% and 5.9%, respectively.

That retrenchment showed up quickly in crypto markets. Tokenized metals products tied to copper, gold and silver saw an usually-high spike in losses as their spot prices cooled.

Across exchanges, derivatives and spot-style products linked to metals logged roughly $120 million in combined liquidations over the past 24 hours. Silver-linked contracts led the pack at $32 million in losses, followed by gold- and copper-linked futures. Prices for tokenized bullion products like XAU and XAUT dropped over 7%.

These liquidations reflect how crypto venues are increasingly being used as complementary rails for macro trades.

When metals were ripping higher earlier this week, traders leaned into crypto-native contracts for speed, leverage and round-the-clock access. As prices rolled over, those same markets became a release valve for risk.

Dollar strength hurts

The broader pullback in metals came as the U.S. dollar strengthened on speculation that the Trump administration may be preparing to nominate Kevin Warsh as the next Federal Reserve chair.

A firmer dollar tends to pressure commodities priced in greenbacks, and Friday’s move hit metals across the board. Gold fell sharply from record highs, while silver, crude oil and iron ore also moved lower.

Even with the setback, however, metals remain one of the strongest themes of the year so far. Copper is still headed for a strong weekly gain, having recently rallied on supply constraints and electrification demand, while gold continues to attract flows as investors hedge political and fiscal uncertainty.

Crypto markets are increasingly along for that ride – not as a separate trade, but as a parallel venue where global macro bets now play out in real time.