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    Lesson · ~8 min

    Precious Metals 101

    Gold, silver, copper, palladium and platinum — what they are, how 1:1 backing works, and why LBMA + Proof of Reserves matter.

    Educational content only — not investment advice. Metal prices fluctuate; physical custody, audits and PoR are what separate real backing from a story.

    The five metals

    Gold (XAU)

    Au

    Use: Monetary reserve, jewelry, electronics.

    5000+ years of trust. LBMA Good Delivery bars (~400 oz / 12.4 kg, ≥99.5% purity) are the global standard for vault settlement.

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    Silver (XAG)

    Ag

    Use: Industrial (solar, EVs), photography, jewelry, monetary.

    LBMA Good Delivery bars ~1000 oz (~31 kg), ≥99.9% purity. Most reactive of precious metals — both store-of-value and industrial.

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    Copper (XCU)

    Cu

    Use: Electrification, grid, EVs, plumbing.

    "Dr. Copper" — leading economic indicator. LME standard: Grade A cathodes (≥99.9935%, ~25 kg).

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    Palladium (XPD)

    Pd

    Use: Catalytic converters (gasoline cars), electronics, hydrogen tech.

    Rarer than gold. ~80% of supply from Russia + South Africa → high geopolitical premium. LPPM Good Delivery plates ≥99.95%.

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    Platinum (XPT)

    Pt

    Use: Diesel catalysts, hydrogen fuel cells, jewelry, lab equipment.

    Hydrogen economy bet. LPPM Good Delivery plates ~1–6 kg, ≥99.95%. Historically traded above gold; currently at structural discount.

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    Three concepts to remember

    1:1 Backing

    Every unit of a metal-backed token represents 1 unit (oz / g) of physical metal held in an audited vault. No fractional reserve, no rehypothecation.

    LBMA / LPPM

    London Bullion Market Association (gold + silver) and London Platinum & Palladium Market set the Good Delivery standard: bar weight, purity, refiner list. The global benchmark for physical settlement.

    Proof of Reserves (PoR)

    Independent auditor verifies that on-chain supply ≤ vault holdings. Published monthly or quarterly with serial numbers, weight, assay certificates. Without PoR, "backing" is just a promise.

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