A loud claim is making the rounds in the metals community right now, and it’s centered on one idea: the paper silver market may be carrying a short position that is simply too large to ignore.
Macro commentator NoLimit says the numbers are extreme. In his words, “Silver production: ~800M ounces/year. Bank shorts: 4.4 BILLION ounces.” His argument is that if silver keeps climbing, large financial institutions could be forced into a scramble to cover positions, and that could trigger violent price swings.
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What the Image Is Claiming
The image he shared breaks the story down into a simple table titled “Institutional Silver Short Positions (Commodities Desk) – Q1 2026 Estimates.”
It lists:
- Bank of America at 1,000 million ounces net short (shown as 125% of global annual mine supply).
- Citigroup at 3,400 million ounces net short (shown as 425% of global annual mine supply).
- Total combined at 4,400 million ounces, which the table frames as 550% of global annual mine supply.
It also lists global annual mine supply at roughly 800 million ounces (100%).
If those figures were accurate, the headline implication is obvious: the paper short exposure would be multiples of what the world produces in a year.
What Crypto Veteran Thinks Is Happening
NoLimit argues that recent price action wasn’t “normal volatility.” He points to silver spiking near $92, dumping fast, bouncing, and then selling off again. He frames it as deliberate pressure to prevent a clean break above $100, because a move like that could trigger margin stress for large short holders.
He also claims the physical market is sending a different signal. He mentions lease rates rising and “backwardation,” which is when spot prices trade above futures prices. His takeaway is that some buyers want metal now, not a paper promise later. He even suggests “cash settlement” and “force majeure” risk if the market tightens further.
Read also: The Real Reasons Gold and Silver Prices Exploded—And Why Few Are Talking About It
A More Grounded Take on Silver
Here’s the important part: the image itself says “internal estimates.” That matters. Without a clear, verifiable source, the numbers should be treated as a claim, not a confirmed fact.
Also, “short” doesn’t automatically mean “wrong” or “doomed.” Banks can be short for many reasons, including hedging exposure for clients, market making, or offsetting other positions. A huge gross number can look scary without the full context of offsets and collateral.
That said, the broader point is still worth watching. When silver is this volatile and the “paper vs physical” conversation heats up, it usually means positioning is crowded and stress is rising somewhere.
If silver keeps holding elevated levels and physical tightness really shows up (premiums, delivery delays, sustained backwardation), then the squeeze narrative gets louder fast. If not, this could be another cycle of big claims riding a hot chart.
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