The Block reported:
Meanwhile Group, a Sam Altman-backed crypto startup, has launched a bitcoin private credit fund via its investment management subsidiary Meanwhile Advisors amid the ongoing crypto rally.
Fund principals are based in Austin, Texas. Fees are remarkably similar to private equity underwriters (PEU).
Why would someone with access to AI want to back a bitcoin private credit fund? Surely Mr. Altman knows the dirty role bitcoins is playing across the globe.
The man who wants you to trust his artificial intelligence offerings wants you to put your retirement kitty into a fund targeting a 5% return on bitcoin holdings.
Net out the 2% management fee and the 20% carried interest (one fifth of five percent is one percent) and investors end up with a 2% annual return.
I don't see real people putting money into Meanwhile. The Silicon Valley "live forever" crowd may invest but they aren't known for their loyalty. A company press release stated:
In the coming months, Meanwhile Group aims to develop a comprehensive range of financial products denominated in cryptocurrency, including term life insurance and accidental death coverage in BTC.
And how many state insurance regulators are going to allow such products?
Meanwhile may wish to offer ransomware coverage. They'll have what the crypto-crooks want. Anonymity. Speed. Access. Bitcoin.
Update 12-13-23: FASB (financial watchmen) turned away from bitcoin crime with a crypto update to their accounting standards. The update includes:
- Meet the definition of intangible asset as defined in the FASB Accounting Standards Codification®
- Do not provide the asset holder with enforceable rights to or claims on underlying goods, services, or other assets (what about dollar or gold backed crypto?)
- Are created or reside on a distributed ledger based on blockchain or similar technology
- Are secured through cryptography
- Are fungible (until they are not)
- Are not created or issued by the reporting entity or its related parties.
What about an investment in a crypto credit fund like Meanwhile which has many related parties?
Update 1-4-24: Fourteen firms hope the SEC approves their applications to offer Bitcoin ETFs.