In today’s turbulent global economic landscape, silver is rapidly emerging from gold’s shadow to become one of the most strategic and contested assets at the heart of speculative, industrial and geopolitical dynamics. It is no longer merely a raw material for jewellery or a marginal trading instrument in the markets: silver is becoming the protagonist of a paradigm shift.

A metal with a dual nature: between industry and finance

Unlike gold, which functions primarily as a store of value and safe-haven asset, silver has a “dual-use” nature, making it indispensable to both the industrial sector and the speculative one. Its physical properties — electrical and thermal conductivity, malleability, corrosion resistance — render it essential across several industries:
• Energy transition: it is a key element in the production of solar panels, where it accounts for up to 10% of material costs.
• E-mobility: it is present in every electric vehicle, particularly in circuits and electronic components.
• High-tech: it is used in the production of chips and semiconductors, making it critical for the AI and digital sectors.

A market under pressure: growing demand and constrained supply

Industrial demand is growing steadily and, according to the Silver Institute, reached a record high in 2024 of over 600 million ounces, driven by renewable energy, consumer electronics and infrastructure investment. However, supply is failing to keep pace.

Principal silver producers (2024):

• Mexico (approximately 200 million ounces)
• China
• Peru
• Chile
• Australia

Principal importers:

• United States
• India
• Germany
• Japan
• South Korea

Many countries with high technological and industrial intensity lack domestic mineral reserves, making supply vulnerable to logistical and geopolitical disruptions.

A manipulated market?

As highlighted in analysis published by Mauro Bottarelli, silver is also one of the most manipulated markets in the derivatives space. For years, the spot price was artificially suppressed below the “psychological” threshold of $35 per ounce, regarded by bullion banks as a Maginot Line to prevent the structural re-rating of the asset.

Today, however, this barrier has been breached: in recent weeks a breakout to $40 per ounce has been recorded, fuelled by the scarcity of ETF securities available for short-selling and by a growing net long position on COMEX futures. Is this the end of a suppression that has lasted for decades?

Geopolitics and emerging narrative: the Russian card

A further source of market distortion is the growing narrative that Russia is accumulating silver to cushion the effects of Western sanctions. Having announced in September 2024 its intention to diversify its reserves into alternative metals — including silver — Moscow is now being pointed to as the alleged architect of the rally.

The risk is that the sanctions or regulatory machinery is activated against metals markets, with export restrictions, modifications to futures contracts and attempts to engineer the price. All of this could, however, produce a boomerang effect, driving investors towards the asset precisely because of its “strategic” implications.

Historical price analysis: a bearish trend in (possible) reversal

Historically, silver has exhibited considerably greater volatility than gold. After reaching nearly $50 per ounce in 2011, in the wake of the global financial crisis and ultra-accommodative monetary policy, it subsequently underwent a prolonged retracement.

In recent years, however, the growing recognition of its role in the “green” economy and in technology, combined with increasingly evident supply dynamics and manipulation, has reignited interest among institutional investors as well.

Future outlook: between new regulations and explosive demand

In the medium term, silver could benefit from:
• Structural growth in industrial demand, particularly from solar energy, electric vehicles and AI.
• Geopolitical tensions that incentivise the accumulation of strategic reserves.
• Declining physical stockpiles and difficulties in mineral exploration.
• Structural weakness of fiat currencies and a return to demand for real assets.

However, risks remain:
• Extreme volatility, often amplified by financial leverage and derivatives operations.
• Systemic manipulation, which can hinder the genuine price discovery process.
• Emergency regulations, such as restrictions on ETFs or export controls.

Conclusions: an asset to monitor, not only for investors

Silver is no longer merely a secondary precious metal: it is a barometer of the energy transition, of the systemic fragility of derivatives markets and of the new financial cold war. For investors, it represents an opportunity, but also a significant risk, to be carefully assessed within a well-diversified portfolio.