November 2020 Market Commentary

November 2020 will forever be remembered as the month that Bitcoin climbed to $19,849 establishing a new all-time high and eclipsing the previous mark set nearly three years ago in December 2017. Lost in the barrage of Bitcoin news and narratives is that this is a broad-based movement across the entire asset class with Bitcoin ranked #36 in year-to-date return out of the top 100 digital assets. 

This year has been a stark demonstration of the drum we continue to beat that digital assets are an inherently reflexive asset class. Most investors passed on the opportunity to add exposure to the asset class as Bitcoin collapsed to $4k levels in March. Fast forward to today to find institutional and retail alike piling into Bitcoin at a price tag of $18k-$19k. This is reflexivity in a nut-shell.

There are always narratives as to why this time is different. It is true that the institutions have finally arrived and that is certainly new and bullish. However, there is a reason “this time is different” is an old adage of impending crisis. We expect 2021 to be an incredible year for digital assets as the ball has only just begun rolling but it’s best to not forget that all reflexive episodes eventually unwind. We are merely in another inning of the same game.