Sam Altman-backed Meanwhile Group launches new fund offering 5% annual yield on Bitcoin

Bitcoin offers 5% annual yield

Meanwhile Advisors, an American investment management company, has announced the private credit fund “Meanwhile BTC Private Credit Fund LP” for the crypto asset (virtual currency) Bitcoin (BTC).

The fund offers a 5% annual yield in BTC and aims to raise $100 million (approximately 14 billion yen). The plan is to close by the end of the first quarter of 2024.

A credit fund is a system that invests raised funds in bonds and loans, and a BTC Private Credit Fund earns profits by lending Bitcoin to borrowers.

Meanwhile Advisors’ parent company, Meanwhile Group, is a startup that has raised $19 million (2.7 billion yen) from OpenAI CEO Sam Altman and Google’s AI-focused Gradient Ventures. Our sister company, Meanwhile Insurance, operates a Bitcoin-based artificial intelligence (AI) life insurance business.

connection:BlackRock and others submit revised version of Bitcoin ETF application, expectations increase for simultaneous SEC approval

Fund design, operating costs

Meanwhile, BTC Private Credit Fund is a closed-end fund that raises one-time funds and does not accept funds from new investors. Investors transfer US dollars to the fund, which is converted into Bitcoin.

Annual management cost is 2%. Additionally, the fund manager will not receive any carried interest on profits from Bitcoin price increases, and will receive a 20% fee (on interest) only if the investment is successful.

The minimum investment in the fund is $250,000 per LP, with no maximum limit. The investment period is three years, with a total operating period of seven years, including a four-year harvest period. Zac Townsend, co-founder and CEO of Meanwhile Group, said: “The majority of capital is likely to be returned before the end of seven years, as capital can be returned to investors during the harvest period.” Ta.

During the 2022 bear market, which saw the collapse of crypto lending companies such as BlockFi and Celsius, Meanwhile Advisors said it would protect its customers from bank runs by offering conservative loans. The fund’s administrator is Anchorage Digital, the first federally regulated cryptocurrency bank.

connection:Prediction of Bitcoin reaching $125,000 in 2024, Matrixport analysis based on halving

Differences between physical Bitcoin ETF and Meanwhile fund

In the United States, expectations are high for the SEC (Securities and Exchange Commission) to approve the listing of the first physical Bitcoin ETF. This ETF holds actual Bitcoin as an asset and follows price fluctuations in the Bitcoin market. As the price of Bitcoin rises, the value of the ETF’s assets also rises, providing investors with attractive returns.

Meanwhile’s fund, on the other hand, plans to lend Bitcoin to borrowers and provide returns in Bitcoin. Townsend emphasized that this allows them to consistently increase their exposure to Bitcoin, regardless of Bitcoin’s price fluctuations.

Bitcoin ETF review list
Source: Bloomberg Intelligence

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