###It was an intelligent guess. 

The Elves knew that an all-powerful and all-dominant Ring was forged by Sauron in Mount Doom, thanks to Celebrimbor. 

>But the Elves were not so lightly to be caught. As soon as Sauron set the One Ring upon his finger they were aware of him; and they knew him, and perceived that he would be master of them, and of an that they wrought. Then in anger and fear they took off their rings. 

This information was very likely to have been relayed down to Galadriel and Gil-galad when Celebrimbor gave them the Elven Rings.

What they didn't know was *How to destroy it*. Putting two-and-two together, they reckoned that the Ring could only be destroyed in the place it was made in.

>'Alas! yes,' said Elrond. 'Isildur took it, as should not have been. It should have been cast then into Orodruin's fire nigh at hand where it was made. But few marked what Isildur did. He alone stood by his father in that last mortal contest; and by Gil-galad only Cirdan stood, and I. But Isildur would not listen to our counsel.

So when the time came to destroy the Ring in the Second Age, Elrond and Cirdan **counselled** Isildur to destroy it, in the fire.

[![enter image description here][1]][1]

And fast forward to the Third Age, Elrond merely repeated this information at the Council of Elrond.


  [1]: https://i.sstatic.net/lpZVc.gif