I believe it's a sterling or coin silver "toddy ladle"....For some reason it looks vaguely Russian....but more probably South American. Is the handle hollow? What does the end of the handle look like?

The handle appears to be hollow, and the whole piece weighs 142g (5 oz). It appears to be handmade. Below is the end of the handle. The hanger also appears to be handmade.

The design on the bottom resembles a chess knight to me. I doubt if it is and have no idea what the significance of it would be if it was. It is really neat and I would certainly have picked it up as well!

I agree....would be an awkward soup ladle....but for dipping water?
It's silver...likely sterling or at least coin.
And that hanging loop.....sounds like ti was always at the ready....Water dipper?
And how was it made? It appears that perhaps it was filled with wax or rosin....then tooled? And the handle decorations appear to have been worked before the handle was attached.
Instead of serving something....could it have been used to pass and collect something?
Tis a puzzle!

This is what I found on silver water dippers.
http://www.smpub.com/ubb/Forum19/HTML/000580.html

Bed warmer for a doll's bed.;)

Holy water dipper? Baptismal font dipper (if the church is of the sprinkling and not the dunking persuasion)?

If it was intended for Christian sacraments it would have Christian symbols.

I think it's a drinking water dipper, intended to hang by the source of the fresh water....for a very fancy household!
Afterall, even if you lived in a palace, if you didn't have the proper plumbing you didn't have fresh water from a tap!

I know you put some measurements in OP but would like to see next to something familiar for perspective?? You said a little more than a foot long and about 3.5 "circumference"?? Maybe diameter? That size circumference would be smaller than index finger to thumb "circle"??

Oops, yes diameter of opening is 3-1/2". Here it is next to my hand/arm for perspective.

Now THAT's impressive! Hope somebody knows more about it.

It makes me think of a dipper for mulled wine.

It is beautiful, mysterious, and I would have grabbed it up too!

It may be a hot toddy ladle. Try googling that phrase and you'll find some images of ladles with big bowls like yours.

http://cranejewelers.com/restoration-of-an-18th-century-sterling-silver-ladle/

Hot toddy ladles usually have a wooden or bone handle that doesn't conduct heat....and I have never seen one with a hanging loop.