River Financial, a San Francisco-based bitcoin technology and financial services company, has eliminated trading fees for the recurring bitcoin (BTC) orders. The move comes less than two months after crypto exchange Binance began rolling out zero-fee trading of the currency on its platform.
“I think [zero-fee bitcoin trading] is somewhat in reaction to the bear market, but I do think that it’s inevitable,” River Financial co-founder and CEO Alexander Leishman told CoinDesk during an interview.
Financial institutions are increasingly offering bitcoin brokerage to allow clients to buy and sell the asset, and the increased competition is bringing in a new era of price margin compression for brokerages, Leishman said.
“The long-term trend is fees going to zero for bitcoin, and we’re really just leaning into it,” he continued.
River Financial’s zero-fee trading becomes effective one week after a customer sets up their first recurring BTC order, and there’s no order size limit. The underlying trading strategy is dollar cost averaging (DCA), where an investor purchases assets on a set schedule rather than in reaction to market movements.
“The benefit of DCA is removing your emotions from accumulating bitcoin. It’s easy to get caught up and stressed about price movements,” said Leishman.
Leishman said the DCA side of the business was a starting point for River Financial’s zero-fee trading. The company currently feels its brokerage product provides value for one-time orders and justifies a trading fee. He noted that River Financial has lowered and simplified its fee structure across its products.
River Financial continues to roll out its River Mining program, unveiled last October. Customers can purchase bitcoin mining machines and leave the set-up and maintenance in River’s hands. The near-term roadmap also includes the Lightning Network, which allows users to send and receive BTC quickly and with lower fees by moving the transactions off-chain.
“We are spending a lot of time investing in our Lightning Network Infrastructure, which we think is going to be a huge opportunity down the road for various financial products to be built and delivered to our clients,” said Leishman.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.