That's just not true.

Basically they are taking 1 ounce of silver and selling it to 250 to 500 people and it works because the people never ask for the physical product but they all think they own different pieces of silver but in reality it's the same piece.

Or look at this way. Game stop sells 500 people a game. They have the option to just download the game through a code that game stop provides but they could of they choose get the physical copy of the game. But why would they do that as it is not common place to do. So game stop only owns 1 copy of the game for 500 people. But then one day the people get wise and decide they want their physical copies and demand that GameStop provide them with the discs. Problem is not only do they not have enough discs to supply everyone with a copy they can't even find enough disc that exist in the world to supply them all with one.