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When the AI bubble bursts, silver is Eric Sprott’s play

Mining

2 Jul 2026

Kristie Batten

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Silver stocks are primed for a re-rate when fundamentals take over, says Eric Sprott. Pic: Getty Images

Silver has been a wild ride for investors so far this year, halving since its January record

Billionaire mining investor Eric Sprott remains bullish on the outlook and tips equities to benefit

When the turn comes, several ASX-listed companies will be ready to capitalise

After being the best performing commodity of 2024 and 2025, silver has been on a volatile ride so far this year.

Spot silver peaked at more than US$120 an ounce in late January but quickly fell to as low as US$70/oz in early February.

Renowned Canadian mining investor Eric Sprott attributed the sharp fall in late January to commercial banks being short silver.

“Oh my god, their losses when silver was US$120 were just incredible,” he said during a Sprott Money interview last week.

In the past week, silver has hit new 2026 lows, falling to below US$60/oz.

Sprott said silver, as well as gold, would bounce back for fundamental reasons.

He pointed to currency debasement and spiralling US debt, which had only been exacerbated by the war with Iran.

“Unfortunately, from a USA perspective, they just keep losing allies more and more and when you lose an ally, he doesn’t want to own your currency, so I think we’ll be right back to that dollar weakness,” Sprott said.

“One of the things I do fall back on is the knowledge that when silver and gold were currencies, silver traded at a 15-to-1 ratio to gold.

“When gold was at US$4500, silver should have been US$300, but has been suppressed for all these 50-odd years by banks who’ve been short the whole time – and maybe I should get mad at myself for playing in a game where it’s manipulated, right?”

The AI effect

Sprott said the biggest factors hindering precious metals were the stock market and the strength of tech stocks, and more recently artificial intelligence stocks.

He said he was concerned by the growing chorus of large companies sounding the alarm on unsustainable AI spending.

“If the market rolls over here because we’ve had it wrong all along, which we might very well have, I suspect we have with so many areas of weakness already – housing, commercial real estate, private equity, private bonds – it’s just endless all the things that are having trouble,” Sprott said.

“If the general market wants to roll over because AI doesn’t make it, I think people will have to look again at the precious metals.”

Sprott owns substantial stakes in dozens of mining companies, though his largest position is US-listed Nevada silver developer Hycroft Mining.

“I think my first move when I decide that I want to introduce more funds into the precious metal markets, it will be some derivation of silver stocks,” he said.

“I think silver stocks will be by far the best.”

ASX stocks battered but advancing

Most of the ASX-listed silver stocks have tracked the fall in the price, regardless of positive news flow.

If Sprott is right and the market turns, many of them will be ready to capitalise with several advancing plans to grow or start silver production.

One of the few producers in Australia, Broken Hill Mines (ASX:BHM) , recently restarted mining at the silver-rich Pinnacles deposit, with ore to be trucked 15km to its underutilised Rasp plant.

This week, the company announced it had delivered the first silver-lead-zinc ore for processing.

Pinnacles has a historical resource of 6 million tonnes at 132 grams per tonne silver, 3.3% lead and 4.7% zinc, which will be updated later this year following recent hits of more than 1500g/t silver equivalent.

Boab Metals (ASX:BML) this week confirmed the development of its Sorby Hills silver-lead project in Western Australia remained in track for first production in the June half of next year.

The company is preparing to move the former DeGrussa copper plant to site and will release updated economics this quarter.

Also due to release new economics is Silver Mines (ASX:SVL) , with a definitive feasibility study for its Bowdens project in New South Wales due shortly.

The company is progressing approvals and recently paid $12.5 million for a parcel of land and water entitlements adjacent to the site.

Maronan Metals (ASX:MMA) recently attracted a $22 million investment from US private equity firm Kinterra Critical Materials & Infrastructure Opportunities Fund II, giving Kinterra a 19.99% stake.

The Maronan project in Queensland has a resource of 33.1Mt at 108g/t silver and 6% lead, as well as copper and gold, and the Kinterra investment will fund Maronan’s 2026 drilling program and technical and regulatory work associated with the prefeasibility study.

Kinterra is known to Aussie small cap punters, having won the race for nickel junior Cannon Resources in 2023 and copper developer...