Why has silver become the unexpected dark horse in 2025?

By the end of December 2025, silver is expected to reach nearly $71 per ounce, with an annual increase of over 120%. Many friends have already started to slap their thighs, while at the same time, gold has also risen by about 60%; Bitcoin was more dramatic, soaring to 126,000 in October before falling back to around 87,000 by the end of the year, failing to attract much capital during times of high risk aversion.

What makes silver outperform gold?

The first layer of reason is that the macro environment has given a green light to hard assets.

In 2025, global monetary policy has shifted to easing, with the Federal Reserve cutting interest rates multiple times, pushing down real yields and weakening the dollar. Low real interest rates + ongoing inflation fears = the most comfortable breeding ground for hard assets. It's not surprising that gold has risen from a low of 2600 to 4500.

But silver is impressive at the second layer; it can also benefit from the dividends of economic expansion, serving both as a store of value and an industrial necessity. So when the cycle comes, silver has historically loved to do one thing: amplify the precious metal market.

The fourth layer, industrial demand, is the engine driving this wave of silver. Currently, industrial usage accounts for nearly half of silver consumption, and it is still increasing.

Where does the largest incremental demand come from?

Solar energy + electrification + electric vehicles; an electric vehicle typically uses about 25 to 50 grams of silver, significantly more than gasoline vehicles. Sales are experiencing double-digit growth, and with the addition of charging stations and fast charging equipment, a large amount of silver is needed. Currently, the supply side cannot keep up. Much of the silver is a byproduct from mining base metals like copper and lead-zinc; you can't just simply dig more silver out on demand. The result is that the global silver market will experience a supply shortage for the fifth consecutive year in 2025. It's strange if prices don't rise.

The fourth layer is that defense spending is quietly consuming silver. Modern weapon systems, such as radar, guided electronics, drones, and secure communications, all rely on silver. What's worse is that some silver used for military purposes is destroyed after use and cannot be recycled. Military spending reached a new high in 2024 and is expected to continue to increase in 2025 due to conflicts in Ukraine and the Middle East.

Can it continue to rise in 2026?

To be honest, most of the driving forces are still in place; electric vehicles, expanding power grids, renewable energy, and defense budgets haven't shown any obvious signs of slowing down; meanwhile, supply remains tight. New mines not only have long cycles, but recycling can't make up for the 'military consumption' gap. If real yields remain low, gold may still perform well; if risk appetite increases, Bitcoin may rebound.