Interest in silver is spilling into tokenized markets, with on-chain trading volumes rising in parallel with activity in futures and exchange-traded funds (ETFs), as the metal experiences volatility after hitting successive all-time highs throughout the month.
Data from RWA.xyz shows that monthly transfer volume for its tokenized version of iShares Silver Trust (SLV) has increased over 1,200% in the last 30 days, along with a roughly 300% increase in holders and a nearly 40% increase in net asset value.
Tokenization involves representing real-world assets, such as private equity, real estate, commodities, and more, as digital tokens on a blockchain. The process helps make assets more easily tradable and divisible, opening up new possibilities for fractional ownership and liquidity.
The tokenized silver trust, for example, allows non-US investors to gain exposure to SLV, with the ability to mint, redeem and transfer tokens 24 hours a day.
Prices in physical markets have diverged sharply from futures prices, with analysts noting that premiums in Asia have reached double-digit levels relative to the COMEX, and the London forward curve is in backwardation, meaning that at around $80 an ounce the metal costs more today than in the future, a sign of short-term supply stress.
Silver’s rally has been driven by a convergence of supply constraints, structural demand, and macroeconomic tailwinds that have constrained physical markets.
Analysts note that China’s decision to impose export licenses on refined silver from January 1 adds to concerns about supply availability (boosting prices), while higher futures margins and year-end positioning have complicated trading in traditional venues.
At the same time, demand from the solar energy industry continues to rise, and silver consumption tied to PV manufacturing remains largely inelastic even after prices tripled from 2024 levels.
The rally in on-chain silver in parallel with its TradFi counterpart appears to be another data point proving that tokenized versions of assets are a trend that is here to stay.
