Silver's gains doubled this year, outperforming gold. Did Bitcoin lose again?

Since the beginning of this year, due to the Trump administration’s unconventional economic policies prompting investors and central banks around the world to seek safe-haven assets, gold prices have experienced a strong rally. However, the most eye-catching performance currently comes from silver, which has doubled in price so far this year, with a return on investment exceeding 100%, far higher than gold’s 60%. Gold bull Peter Schiff has repeatedly advised people to go long on gold and silver this year, while also taking the opportunity to mock Bitcoin (BTC), claiming that gold and silver’s breakout is very bearish for Bitcoin. Bitcoin has fallen 2% so far this year, making it one of the few assets to decline this year.

Precious metal silver has many practical values

As a precious metal, silver is not only rare and beautiful but also has many practical uses. Silver is an excellent conductor and is widely used in circuit boards, switches, electric vehicles, and batteries. Silver paste is a key component in solar panels, and silver is also used as a coating for medical devices. Since silver inventories are near historic lows and investors are still scrambling to buy, there is a risk of supply shortages that could impact multiple industries.

Who is buying silver?

As a precious metal like gold, silver remains a popular material for making jewelry and coins. China and India are still major buyers of silver, thanks to their large industrial bases, huge populations, and the important role that silver jewelry plays as a store of value passed down through generations.

Governments and mints around the world also consume large amounts of silver to produce bullion coins and other products. As a tradable asset, silver’s unit price is much lower than gold, making it more accessible to retail investors. Moreover, when precious metal prices rise, silver tends to be more volatile than gold.

What factors affect silver prices?

Silver has wide-ranging uses, meaning its market price is affected by various factors, including manufacturing cycles, interest rate fluctuations, and even renewable energy policies. When the global economy accelerates, industrial demand tends to drive up silver prices. When a recession hits, investors may enter the market as alternative buyers for hedging purposes.

Silver has poorer liquidity and no central bank reserves

It’s worth noting that the silver market is less liquid compared to gold. Daily trading volumes are smaller, inventories are tighter, and liquidity can evaporate quickly. According to Bloomberg, the value of silver stored in London is just under $50 billion, while gold is as high as $1.2 trillion. For gold, the London market is backed by roughly $700 billion in reserves, mainly held by central banks in the Bank of England’s vaults. When liquidity tightens, this gold can be lent out, essentially making central banks the lenders of last resort—but there is no such reserve for silver.

Why has silver doubled in price this year?

Silver prices usually move in tandem with gold, but with greater volatility. After gold prices surged in early 2025, some investors pointed out that the gold-to-silver price ratio had exceeded 100, and silver’s relatively low price compared to gold was enough to attract substantial buying from some investors.

The heavy debt burdens in major economies like the US, France, and Japan, as well as a lack of political will to address these issues, have also prompted some investors to hoard silver and other alternative assets this year. This has led to a broader exodus from government bonds and currencies, known as the “devaluation trade.” Bitcoin’s previous rally has also been attributed to this trend by many.

At the same time, global demand for silver has exceeded mined production for five consecutive years, and the top three producers—Mexico, Peru, and China—are facing setbacks ranging from regulatory hurdles to environmental restrictions.

Exchange-traded funds backed by silver have also attracted new investment. Gold bull Peter Schiff has repeatedly advised people to go long on gold and silver this year, while also taking the opportunity to mock Bitcoin (BTC), claiming that gold and silver’s breakout is very bearish for Bitcoin. Bitcoin has fallen 2% so far this year, making it one of the few assets to decline this year.

(Gold and silver hit new all-time highs, Peter Schiff: Bitcoin pales in comparison)

This article Silver Doubles in Price This Year, Outperforming Gold—Has Bitcoin Lost Again? first appeared on Chain News ABMedia.