Where Did the Paper Silver Market Go?

Silver Dominion: Gold & Silver

Jun 03, 2026

Imagine someone told you a few years ago that open interest in silver futures would fall by more than half from its previous peaks.

What would you expect?

Probably a much lower silver price.

Less investor interest.

A market losing momentum.

Yet today we see the exact opposite.

Open interest on COMEX silver is currently around 100,000 contracts. That is roughly 60% lower than the peaks seen in 2011 and 2020, when open interest exceeded 230,000–245,000 contracts.

Back in 2020, silver reached a peak just below $30 per ounce while open interest stood near 236,000 contracts.

Today, silver trades around $75–80 per ounce despite a much smaller futures market.

In other words, silver is significantly more expensive even though speculative participation in the futures market is dramatically lower.

And that is exactly why I find this chart so fascinating.

If speculative capital were still the primary driver of the market, I would expect the opposite.

Instead, it seems that something much more interesting may be happening beneath the surface.

Something Has Changed

Markets are usually fairly logical.

When new capital enters, open interest tends to rise.

When speculation increases, more futures contracts are created.

When investors add leveraged positions, open interest expands.

That is exactly what we witnessed during previous major silver bull markets.

But today, the question is: Where Did the Paper Silver Market Go?

The paper silver market is far smaller than it was a few years ago, yet silver prices are considerably higher.

To me, that is not a meaningless statistic.

In fact, it may be one of the most important developments currently taking place in the silver market.

Where Did the Speculators Go?

That is the question I keep asking myself.

Where did tens of thousands of futures contracts disappear to?

Where did the capital go?

Perhaps some investors moved into technology stocks.

Perhaps some shifted toward cryptocurrencies.

Higher interest rates may have also reduced the appeal of leveraged futures positions.

Whatever the reason, the result is the same:

The paper silver market is substantially smaller than it was during previous peaks.

Yet silver prices remain surprisingly strong.

Looking Beyond COMEX

Perhaps we are focusing too much on the futures market.

Because outside COMEX, some very interesting things are happening.

China imported approximately 836 metric tons of silver in March 2026 — the highest monthly import figure on record.

Total imports for the first quarter reached roughly 1,626 metric tons, also a record.

Those are not numbers that can easily be ignored.

If such large volumes of metal are moving across the world, someone clearly wants that metal.

Someone is willing to pay for it.

And someone is buying it despite prices being much higher than they were just a few years ago.

Physical Silver Is Not the Same as Paper Silver

This is where I believe many investors make a mistake.

A futures contract and physical silver are not the same thing.

A futures position can be opened and closed within minutes.

Physical metal often moves into the hands of investors, companies, and institutions that may hold it for years.

That is why I pay close attention to where the metal is actually going.

Price is often the final result.

The real changes usually happen much earlier.

First, metal flows change.

Then inventories change.

And only later does the price begin to reflect those developments.

Why I Find This Bullish

I am not suggesting that low open interest automatically means higher prices.

Markets are never that simple.

However, I do see something encouraging in the current setup.

If today’s silver price were supported only by speculative enthusiasm, I would expect record open interest, high leverage, and a flood of capital into futures contracts.

Instead, we see the opposite.

Open interest remains far below previous peaks, yet silver trades at much higher prices than it did then.

That raises an interesting possibility:

Perhaps today’s silver market is standing on stronger foundations than some previous rallies.

Perhaps it is increasingly being driven by genuine physical demand rather than speculation alone.

What Could It Mean?

Nobody knows where silver prices will go next week, next month, or next year.

But the current combination of data is worth paying attention to.

We have:

Open interest roughly 60% below previous peaks.

Record silver imports into China.

Continued movement of physical metal.

Another year of structural market deficits.

Silver prices higher than when open interest was more than twice today’s level.

If speculative capital eventually returns and open interest begins to expand again, it could be entering a market where available physical silver is far tighter than it was in the past.

That is the scenario I find most interesting.

Because it suggests today’s silver market may be much tighter beneath the surface than it appears.

Maybe We’re Asking the Wrong Question

Most investors focus on one thing:

Where will silver prices go next week?

Next month?

Next year?

But I find myself asking a different question:

Where is the physical silver going?

Who is buying it?

And why are record amounts of metal moving around the world while futures market participation remains unusually low?

Perhaps that is where the real story lies.

Because if physical silver continues to disappear into long-term hands while open interest remains subdued, today’s market may simply be the calm before a much more interesting chapter unfolds.