Theo Launches Tokenized Silver Product Based on Lease Commitments

On-chain finance platform Theo has launched a tokenized silver product designed to generate returns from silver lease commitments.

CoinDesk reported on September 16 that Theo rolled out thSLVR, a yield-bearing token linked to the price of silver. The product is structured to give investors exposure to silver price movements while also passing along lease income generated by lending the underlying silver to institutions.

Institutions such as refiners and mints typically borrow silver for a set period rather than buy it outright for production. Buying silver directly would expose them to price fluctuations.

Those borrowers pay lease fees and return the same amount of silver at maturity. Such income has traditionally gone to precious-metals finance firms or dealers, but Theo plans to distribute it to token holders.

thSLVR is launching with more than $40 million in lease commitments secured. Initially, the beta product will be available only to institutions and pre-approved investors. Theo plans to gradually expand access over time.

"The silver market has faced supply deficits for six consecutive years, and lendable inventory in London is nearing a record low," Theo Chief Investment Officer Igor Ioffe said. "As the market tightens, lease rates emerge as a more important signal than spot prices, and the value of lease income increases."