Sam Altman-backed Crypto Startup Wants $100 Million For A Bitcoin Private Credit Fund

Key Points:

• Sam Altman-backed crypto startup Meanwhile, plans are underway to raise $100 million for a Bitcoin private credit fund.
• The fund adopts a single-close, closed-end structure where investors contribute U.S. dollars converted to Bitcoin immediately after closing. 

According to The Block, Sam Altman-backed crypto startup Meanwhile is endeavoring to secure $100 million for its innovative Bitcoin private credit fund. 

Sam Altman-backed Crypto Startup Wants To Launch $100 Million Bitcoin Private Credit Fund

The fund, aptly named Meanwhile Bitcoin Private Credit Fund LP, is designed to grant institutional investors access to Bitcoin while targeting an additional 5% bitcoin-denominated yield.

Zac Townsend, the co-founder and CEO of Meanwhile Group, expressed optimism about the future value of Bitcoin, stating, “Our view is that bitcoin will be worth much more in the future.” The fund aims to achieve a 5% yield by lending bitcoin to borrowers, with a target to raise $100 million and finalize the fundraising by the end of the first quarter of 2024.

The unique fund of Sam Altman-backed crypto startup, structured as a single-close, closed-end fund, allows limited partners (LPs) to contribute U.S. dollars, promptly converted to bitcoin after the single-close. This bitcoin will then be lent to borrowers, potentially yielding exponential outperformance if bitcoin prices rise during the fund’s lifecycle.

Meanwhile Bitcoin Private Credit Fund’s Distinct Approach to Bitcoin Investment

The minimum investment for LPs is set at $250,000, with no maximum limit. The fund has a three-year investment period, followed by a four-year harvest period, resulting in a seven-year total term. Notably, capital is returned to investors during the harvest period, potentially returning the majority of the capital well before the seven-year mark.

Meanwhile Bitcoin Private Credit Fund LP implements a 2% management fee and a 20% carried interest fee, both charged in bitcoin. This fee structure aims to align the fund’s success with the performance of investors’ bitcoin holdings.

Addressing concerns about potential risks, Townsend emphasized the fund’s contrast with collapsed crypto lenders, attributing the difference to conservative loans directed at creditworthy institutional borrowers, with Anchorage Digital serving as the custodian for the fund.

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