Bitcoin-focused financial services company Meanwhile Group, backed by OpenAI CEO Sam Altman, has started a bitcoin private credit fund, the firm announced Thursday.
The closed-end fund seeks to entice institutional investors in part by offering a "conservative" 5% yield denominated in bitcoin, the press release said. Investors will contribute U.S. dollars to the fund, which will be converted to bitcoin, with fees being also charged in the cryptocurrency.
Private credit – where non-bank institutions lend money to enterprises and individuals – is already a massive business in traditional financial markets, and BlackRock forecasts the sector will grow to $3.5 trillion by 2028.
“A thriving Bitcoin economy is inevitable, but to realize this future and maximize its potential, robust capital markets are essential,” Zac Townsend, co-founder and CEO of Meanwhile Group, said in the press release. “This private credit fund offers unparalleled potential for institutional investors to unlock the full value of their BTC holdings without compromising their ownership, seizing a unique opportunity for optimized returns.”
Our insurance company works by taking in premiums, investing them along our own solvency capital, and getting steady, conservative returns in BTC. We have done that with no credit losses to date. Today we're launching a credit fund directly built on top of that experience. https://t.co/NZSSqLrCE6
— Zac Townsend (@ztownsend) December 7, 2023
The fund aims to raise $100 million from investors, The Block reported.
The company set up a bitcoin-based, artificial intelligence (AI)-aided life insurance business called Meanwhile Insurance and raised $19 million in an investment round earlier this year, Townsend said in an interview with CoinDesk TV this June. Investors included OpenSam Altman and Google's AI-focused Gradient Ventures, according to the press release.
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Meanwhile also plans to develop a wide range of financial offerings denominated in crypto, including term life insurance and accidental death coverage in BTC.
Edited by Stephen Alpher.
