Silver’s Setup Is Hard To Ignore

As the calendar turns, it’s natural to reassess what you own — and what you might be missing Looking back at 2025, one asset clearly stood out from the rest: silver. 

Silver finished 2025 up roughly 146%, making it the best-performing major asset of the year. But according to Alan, the more important question isn’t what silver did last year — it’s what’s lining up now. 

In his latest video, Alan breaks down five forces shaping silver’s outlook for 2026. Together, they paint a picture of a market where supply is tight, demand is becoming strategic, and volatility may be creating opportunity rather than risk. 

A Structural Silver Deficit That Isn’t Going Away 

Silver has been running a structural supply deficit for five consecutive years. In plain terms, demand from industry, investors, and other uses continues to exceed what miners can produce. 

When that happens, the market is forced to draw from existing above-ground stockpiles. And as those stockpiles shrink, holders become increasingly reluctant to sell unless prices rise. 

This ongoing deficit has been a major driver behind silver’s recent strength — and there’s little evidence it resolves in 2026. As long as supply can’t catch up, price becomes the pressure valve. 

Governments Are Treating Silver as Strategic 

One of the biggest shifts in 2025 was how governments began viewing silver. 

For the first time ever, the U.S. officially designated silver as a critical mineral. Russia confirmed that its central bank is allocating funds to purchase precious metals, including silver. And China announced tighter controls on silver exports starting January 1, 2026. 

Different countries, different approaches — but the same underlying message: silver matters strategically, and nations want more of it inside their borders. 

When governments move from passive observers to active participants in a market already facing shortages, it changes the supply-demand equation in a meaningful way. 

Backwardation and the Rush for Physical Metal 

One of the more technical — but revealing — signals Alan highlights is silver’s move into backwardation. 

Normally, futures prices are higher the further out you go, reflecting storage, financing, and insurance costs. Backwardation flips that relationship: buyers are willing to pay more to get silver now rather than later. 

In late 2025, silver’s futures curve entered its deepest backwardation since 1980 — the peak of the last major silver bull market. The front-month contract traded several dollars above later contracts, signaling intense demand for physical metal. 

When markets begin to price immediate delivery at a premium, it often reflects stress in supply, surging physical demand, or breakdowns in the usual price-discovery process. More importantly, it can create a feedback loop: once investors see others scrambling for physical silver, the incentive to secure it grows even stronger. 

Easier Monetary Policy Favors Scarce Assets 

Another development flying under the radar is the Federal Reserve’s recent policy shift. 

After more than three years of quantitative tightening, the Fed announced it would stop shrinking its balance sheet as of December 1, 2025. Rate cuts are projected throughout 2026, with forecasts showing a meaningful drop from current levels. 

Historically, looser monetary policy benefits scarce assets — especially those that can’t be created with keystrokes. Even modest rate cuts tend to lower the opportunity cost of holding precious metals. 

From Alan’s perspective, the return toward easier policy removes a major headwind for silver and adds fuel to an already tight physical market. 

Volatility as a Feature, Not a Bug 

Silver is volatile — and that isn’t changing. 

But volatility isn’t just about price swings over time. It’s also showing up geographically. In recent months, silver has traded at unusually large premiums in Shanghai compared to COMEX prices in the West, with gaps as wide as $6 to $9 per ounce. 

Those spreads suggest friction in global arbitrage and strong localized demand for physical metal. Reports of manufacturers and trading firms offering well above spot prices to secure silver reinforce that message. 

For long-term investors, Alan argues this kind of volatility doesn’t invalidate the thesis — it confirms it. Sharp moves, dislocations, and shakeouts are often part of markets where physical supply is tight and paper claims dominate. 

Where This Leaves Silver in 2026 

When you step back, the picture becomes clearer. 

Silver enters 2026 with a persistent supply deficit, rising sovereign interest, unusual signals from futures markets, easier monetary conditions, and growing volatility tied to physical scarcity. 

That combination doesn’t guarantee smooth price action — but it does suggest silver remains firmly in the conversation as one of the most compelling asymmetric setups in the market. 

📺 Watch the full video to hear Alan walk through each trend in detail — and why silver could once again top the list of best investments in 2026. 

People Also Ask 

Is silver a good investment for 2026? 

Silver enters 2026 with a persistent supply deficit, rising government demand, and a shift toward easier monetary policy — a combination that has historically favored scarce assets. In his latest video, Alan explains why these forces could make silver one of the most compelling setups going into the year. 👉 Watch the full breakdown on GoldSilver’s YouTube channel. 

Why has silver been in a supply deficit for so long? 

Silver demand from industry, investment, and strategic uses has exceeded new mine supply for five consecutive years. As above-ground stockpiles shrink, prices must rise to convince holders to sell — a dynamic Alan discusses in detail in his 2026 outlook video. 

Why are governments buying and restricting silver? 

In 2025, the U.S. classified silver as a critical mineral, Russia began allocating funds to buy silver, and China announced export restrictions starting in 2026. These moves signal that silver is being treated as a strategic resource, adding pressure to an already tight global market. 

What does silver backwardation mean for investors? 

Backwardation occurs when buyers pay more for silver today than for future delivery, signaling urgency for physical metal. Silver’s deepest backwardation since 1980 suggests stress in supply and surging physical demand — a key theme Alan Hibbard highlights as a potential driver in 2026. 

Why is silver so volatile compared to other assets? 

Silver’s small market size, heavy paper trading, and dual role as an industrial and monetary metal create sharp price swings across time and regions. According to Alan, this volatility isn’t a flaw — it’s often where disciplined investors find opportunity if they understand the underlying forces.