The sharp price movements in the silver market in recent weeks have not been limited to futures and exchange-traded funds. Increased volatility has also shifted investor interest to tokenized assets. On-chain data shows a remarkable acceleration in demand for digital representations of silver. This situation closely concerns commodity markets and blockchain-based financial products.
1,200% Increase in Tokenized Silver Assets
According to RWA.xyz data, the monthly transfer volume of the tokenized iShares Silver Trust (SLV) product has increased by over 1,200% in the last 30 days. During the same period, the number of investors increased by approximately 300%, while the net asset value grew by nearly 40%. Below, you can see the change in the price of SLV since the beginning of the year, an increase of nearly 170%:
The tokenization model allows physical assets such as silver to be represented on the blockchain through digital tokens. Thus, assets can be divided into smaller pieces, transferred at any time of day, and access to liquidity is facilitated. As in the case of tokenized SLV, investors outside the US can also be exposed to silver price movements without directly accessing traditional markets thanks to these structures.
However, financial demand is not the only factor behind the rise in silver. Supply tightness in physical markets is becoming increasingly visible. The fact that silver premiums in Asian markets are exceeding COMEX futures prices by double digits indicates physical strength. Spot prices exceeding futures prices is also a significant signal pointing to short-term supply pressure.
Analysts emphasize that there are several key reasons for this tightness. China's introduction of licensing requirements for refined silver exports as of January 1st is creating uncertainty on the global supply side. In addition, increased margin requirements in futures and year-end position adjustments are making trading in traditional markets more difficult. On the demand side, the solar energy sector plays a decisive role. The amount of silver used in photovoltaic panel production has not shown a significant decrease, even though prices have increased several times compared to 2024 levels. This chart becomes even more interesting when considered alongside the outlook for cryptocurrency markets. Bitcoin's pullback from its recent peak has caused concern for some investors, while gold and silver's rise to new records has created a sense of divergence in the markets. However, historical cycles suggest this divergence may be more a matter of timing than weakness. In the past, particularly after 2020, it was observed that gold and silver, as stores of value, moved first, while risky assets gained momentum after this upward trend stalled. A similar pattern is evident today. While precious metals maintain their strong performance, Bitcoin is moving horizontally in a wider range. It is known that in liquidity-focused cycles, capital does not flow into every asset simultaneously, but generally shifts gradually.
