River Financial CEO Alexander Leishman and River Intelligence writer Natalie Mutch discuss the major Bitcoin news of 2020, the outlook of the Bitcoin market in 2021, and what can be expected from River Financial in the new year.
N: "Let's begin by briefly recounting 2020. 2020, particularly the second half of the year, saw a lot of price action for Bitcoin. Were you surprised by the rapid uptick in price?"
A: "I wasn’t very surprised. Over the last year we’ve seen increasingly larger buyers scooping up Bitcoin to hold long-term. It was only a matter of time until this led to upward price movement. The vast majority of River clients are buying and holding for the long term, taking a lot of supply off the market.
N: "Bitcoin’s last major bull run was in late 2017. How do you see the current price action compared to the price movement in 2017?"
A: "It feels like we are on the verge of another major bull-run, but unlike 2017 the markets are much more liquid and efficient. While nobody will know what will happen, I have a feeling that if we do experience a bull-market, it will be a bit slower and more sustainable than previous ones."
N: "How do you think the broader macroeconomic events of 2020 impacted Bitcoin?"
A: "I think the pandemic drastically accelerated Bitcoin adoption by individuals and institutions alike. Many of our largest clients have made sizable allocations to Bitcoin primarily because of the unsustainable government spending and quantitative easing from the Federal Reserve. The narrative of Bitcoin being an inflation-proof place to park wealth is going mainstream."
N: "As CEO, how have you prepared River Financial for the growth in the market?"
A: "We have been working diligently to continually improve our brokerage product and elevate our clients’ experience. One of the biggest requests from clients this year has been a mobile app, which we plan to launch next month. We also have a number of exciting features launching next year that we will be announcing over the coming months. Lastly, we have been working around the clock to scale our service team to meet client demand. I’m extremely proud of the River team."
N: "Let's transition to looking towards 2021. After Bitcoin’s bull run in late 2017, it corrected relatively quickly. Do you anticipate a similar correction after the recent all-time high?
A: "I think it’s less likely that we see as large a correction with the next price run-up as we did in 2018. It is a lot easier to short Bitcoin today and the market participants are significantly more sophisticated. However, the one thing that is always true about Bitcoin is that it will never fail to surprise everyone!"
N: "2020 was a stand out year for institutional investment and regulatory support of bitcoin. Do you think institutional adoption and regulation will continue at a similar pace in 2021?"
A: "I believe that this trend is going to only accelerate. Now that some of the largest hedge funds and established institutions like MassMutual have significant Bitcoin allocations, other institutions will feel like they “have permission” to make allocations."
N: "What do you think will drive growth and demand for Bitcoin the most in 2021?"
A: "I think that we will have a perfect storm of government spending, quantitative easing, and the normalization of storing liquid wealth in Bitcoin instead of cash and cash equivalents that will take Bitcoin to unprecedented levels of adoption."
N: "What will be Bitcoin’s greatest challenge in 2021?"
A: "I think Bitcoin’s biggest challenge will be serving the quickly growing number of people making significant allocations of wealth to it. There is a lot of infrastructure left to build, but it is an exciting challenge."
N: "What River Financial product or feature are you most excited about in 2021?"
A: "I am most excited about our mobile app. I think it will be a game changer for both our clients and our company."