Is the silver shortage narrative about to be rewritten? Peter Brandt warns: miners are疯狂 hedging, and the risk of oversupply is accumulating

When silver prices soar and market sentiment is high, well-known trader Peter Brandt issues a warning, reminding investors that extreme trading volume does not necessarily indicate demand is out of control; instead, it may imply potential risks of rapidly increasing supply.
(Background recap: Gold and silver plunge for the second time, Bitcoin hits $81,000, with over 270,000 traders suffering liquidation)
(Additional context: Bitcoin is not as good as buying silver! Since 2017, holding returns have been surpassed by silver, and the crypto market crashes: crypto faith loses 8+9)

Table of Contents

• Silver surges with massive volume, Brandt pours cold water
• From the miner’s perspective: high prices mean hedging pressure
• Recycling supply and demand decline, potentially overturning the shortage narrative

As silver prices skyrocket, trading volume explodes, and market sentiment reaches a peak, the renowned trader and analyst Peter Brandt—who successfully predicted the 2018 Bitcoin crash—warns investors: extreme trading volume may not signify demand is out of control; instead, it could indicate a potential rapid increase in supply. His comments quickly sparked heated discussion in the market and added variables to the recent prevalent narrative of a “long-term silver shortage.”

SILVER
SOMETHING TO THINK ABOUT
With all the hoopla in Silver, let me suggest something you might not be thinking about. We always need to think “below the surface,” down as many layers as possible.
So far this week Comex has traded 4.3 BILLION ounces of Silver — NOT PAPER…

— Peter Brandt (@PeterLBrandt) January 29, 2026

Silver surges with massive volume, Brandt pours cold water

Recently, Brandt posted on X stating that this week, Comex silver futures traded up to 4.3 billion ounces—equivalent to about 5.2 years of global mine production. As prices hit new highs, many investors see such trading volume as strong evidence of demand.

However, Brandt emphasized that this is not the “paper silver” often downplayed in the market, but real futures contract trading volume. In his view, such figures not only represent demand but may also indicate that a large amount of supply is entering the market.

From the miner’s perspective: high prices mean hedging pressure

Brandt further analyzed from the perspective of mining companies: if silver prices rise to $110 per ounce, this price could be 3 to 4 times their all-in sustaining costs (AISC) for low-cost producers. Under such circumstances, it would be highly irrational for miners not to hedge at least three years of future production.

He pointed out that miners are fundamentally running a business and managing risk, not betting that prices will always go up; locking in profits at high prices is a rational and common decision.

Recycling supply and demand decline, potentially overturning the shortage narrative

Brandt also cited data from the Silver Institute, proposing an alternative scenario that the market might overlook:

Under high prices, the supply of recycled silver could double or even triple; simultaneously, due to excessive prices, industrial users might turn to substitutes, leading to a demand decrease of about 10%.

Under such assumptions, the market could develop a “pipeline glut,” with oversupply replacing the previously discussed “shortage,” rapidly eroding the foundation of the shortage narrative.