Silver prices experienced a historic surge, outperforming most markets, before a sharp drop of nearly 10% around $75 per ounce this morning.
Silver Attracts Onchain Investors Massive
The recent price rally was not limited to physical markets or derivatives. It also led to a dramatic influx of capital into tokenized versions of the metal. In particular, the tokenized version of iShares Silver Trust (SLV) saw its monthly transfer volume spike by over 1,200% in the last 30 days. The number of holders increased by about 300%, while the net asset value rose by nearly 40% over the same period.
These figures indicate a clear trend: faced with volatility and supply tensions, some investors are seeking more flexible, fractional exposure that is accessible 24/7. Tokenization allows non-US investors to indirectly access SLV while benefiting from onchain liquidity. This wave of new investors may also coincide with the arrival of retail investors, closer to the blockchain realm.
Extreme Tensions in Physical Markets
The surge in silver did not come out of nowhere. It is based on an explosive mix of supply constraints, structural demand, and macroeconomic factors. Physical markets have shown particularly pronounced signs of stress, with premiums in Asia reaching double-digit levels compared to COMEX prices.
In London, prices are currently in backwardation. In other words, silver costs more today than for future deliveries, a classic signal of short-term scarcity. Around $80 per ounce, the market was sending a clear message: the metal is scarce and in immediate demand.
China, Solar, and Structural Constraints
Among the major catalysts, China plays a central role. Beijing announced the implementation, starting January 1st, of a licensing regime for exports of refined silver. This decision fuels concerns about the global availability of the metal and strengthens price pressure.
Simultaneously, demand from the solar industry continues to rise. Silver remains a key component of photovoltaic panels, and this consumption remains largely inelastic, even after a tripling of prices since 2024. Manufacturers are absorbing the shock, lacking immediate technological alternatives.
A Correction That Does Not Erase the Underlying Trend
Today’s nearly 10% drop, bringing the ounce back around $75, illustrates the fragility of the current balance. Increased margins on futures, profit-taking, and year-end adjustments have exacerbated the movement.
