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Is silver more valuable than gold?

The war in Iran proves that the ‘devil's metal’ is extremely volatile: €105.07 per ounce on 29 January 2026, €62.30 per ounce on 17 February and €71.23 per ounce on 4 March 2026. But silver, sometimes called the ‘poor man's gold’, has a key advantage: it is both a precious metal and an industrial raw material that is essential for the energy transition.

03/31/2026

5 min

Eager for gold, the Spanish conquistadors of the 16th century dreamed of El Dorado. They were mistaken: not only did it not exist, but it was mainly silver metal that they found. Between 1550 and 1660, an estimated 18,000 tonnes of silver were brought to Europe, compared with only 2,000 tonnes of gold. The real wealth was not gold but silver.

In this century, 2025 was marked by historic highs in the price of gold. The evolution of silver was even more spectacular: its price more than tripled to over €100 per ounce at the end of January 2026.

Since then, the trend has partially reversed. Between late January and early February, its value fell by €50 per ounce, reminding investors of its nickname, ‘the devil’s metal’, linked to its historically high volatility. This decline reflects a rapid adjustment in macroeconomic expectations, notably the expectation of controlled inflation and a strengthening dollar following the appointment of Kevin Warsh as chair of the Federal Reserve.

This recent correction does not call into question the underlying dynamics that shape the silver market. While this remarkable rise has often been interpreted as an extension of that of gold prices, silver follows its own dynamic: it is both a financial asset and a key industrial metal for the energy transition, particularly for the conductivity of batteries.

While silver’s volatility remains high and its role as a ‘safe haven’ is less certain than that of gold, industrial demand could provide lasting support for the upward trend in silver prices, if supply constraints persist.

‘Poor man’s gold’, a safe haven asset

The price of silver is sometimes analyzed as a simple reflection of that of gold prices. This perception of silver, sometimes referred to as ‘poor man’s gold’, has solid historical foundations, linked to the central role played by both metals in past monetary systems.

From ancient times to the 19th century, gold and silver formed the basis of monetary systems, whether in the form of gold and silver coins in ancient Rome or European bimetallism, which explains their sometimes synchronised paths. These precious metals also share common uses for jewellery.

Like gold, silver benefits from demand flows during periods of economic and geopolitical instability, when investors turn to precious metals as safe havens. Traditional macroeconomic factors also play a role: a weak US dollar or low interest rates support demand for non-yielding assets.

Added to this are fears of a resurgence of inflation. This reinforces silver’s appeal as a partial hedge against the erosion of purchasing power, even if its status as a hedge against inflation is less established than that of gold. In a context of de-dollarisation, some central banks are strengthening their reserves of precious metals, a phenomenon largely dominated by gold, but which also includes, more marginally, silver, particularly in the case of Russia.

Primarily industrial metal

It is on the demand side that silver’s uniqueness is most apparent. Unlike gold, where demand is primarily driven by central bank reserves and financial investments, silver is primarily an industrial metal – accounting for 50-60% of demand, and used in a wide range of applications.

Silver is an essential input for the energy transition. It is used, for example, in batteries, photovoltaic solar panels, and catheters and prostheses in the healthcare industry. The rise of renewable energies and related infrastructure is creating structural, long-term support for demand, which distinguishes silver from other precious metals.

This industrial role is now extending to the digital transition. Silver is present in many high-performance electronic components needed for data centres and artificial intelligence systems. Its unique properties of conductivity and resistance to corrosion make this metal indispensable. The deployment of digital infrastructure is a growing factor in industrial demand for silver.

The recent recognition of silver as a critical mineral by the United States and China is fully in line with this logic.

Nearly 70% of global production comes from polymetallic mines

This demand dynamic is hampered by an inflexible supply. Although silver is not physically scarce in the strict sense, its supply is structurally constrained. The main specificity of the silver market is that nearly 70% of global production comes from polymetallic mines, where silver is extracted as a by-product of copper, zinc, lead or gold mining.

This structure limits the ability of supply to respond quickly to a rise in silver prices. Mining investment decisions depend primarily on the prices of the main metals, not silver itself. In other words, the supply of silver is relatively inelastic to price, at least in the short and medium term.

Recycling is a significant but unstable source of supply, accounting for around 15-20% of global supply depending on the year. It mainly comes from the recovery of electronic waste, industrial residues and jewellery. A significant proportion of the silver used in industrial applications is dispersed in very small quantities in electronic components, solar panels and electrical equipment, making its recovery technically complex and economically unprofitable.

Main producers: Mexico, China, Peru, Bolivia and Chile

Added to this are geopolitical factors, such as the high concentration of silver production. Mexico, China, Peru, Bolivia and Chile account for more than 60% of global production. China is becoming a key player with a dominant position in refining and the creation of export restrictions announced on 1 January 2026, which are increasing supply chain tensions.

These differences between gold and silver have become more pronounced since the 1990s, to the point where several studies show that the two metals must now be analysed as two separate markets, offering different risk and hedging profiles.

Silver as a financial investment

However, these industrial uses do not diminish silver’s role as a financial asset. Precious metals are traditionally considered as hedges against systemic risks. In situations of extreme geopolitical risk, only gold and silver offer relatively robust safe haven properties. Nevertheless, this similarity should not lead to silver being fully equated with gold.

In practice, while silver can play a hedging role in certain contexts of uncertainty, it generally offers less stable protection than gold during acute financial crises. Nevertheless, silver retains a certain appeal for investors: it may benefit from the energy transition and supply-side tensions.

This is a translated version of an article originally published in French by Yulia Titova on the Conversation France.