Former Bain Manager Launches $50 Million Bitcoin and Ethereum Fund
Some of the wealthiest families in Latin America now have access to a new way to invest, thanks in part to a former senior manager at consulting firm Bain & Company.
Announced today, the newly formed Crypto Assets Fund, co-founded by former senior manager at Bain, Roberto Ponce Romay, is helping to raise $50m with the purpose of buying cryptocurrencies for family offices. Revealed exclusively to CoinDesk, Crypto Assets Fund (CAF) will invest directly in bitcoin, ether, zcash, ripple, litecoin and dash.
The first tranche of the fund, estimated to be valued about $10m, is in the final stages of closing, and is expected to be announced by the end of this month.
In interview, Romay explained that the purpose of the fund was two-fold. First, it was designed to give investors in some of Latin America’s more unstable economies a new way to hedge their investments, and second, it was meant to provide the opportunity to safely learn about these new stores of value for possible future investments.
According to Romay, as the fund's investors are becoming increasingly familiar with the crypto-asset class, the CAF could eventually raise new funds that also include tokens sold as part of initial coin offerings, or ICOs.
"This fund is investor driven," said Romay, who is now the director of investment banking boutique, Invermaster. "It is a simple strategy to give access."
Investment documents provided to CoinDesk further reveal details about how the British Virgin Islands fund intends to invest capital provided by its limited partners.
Fund co-founders, including the vice president of bitcoin payments startup Ripio, David Garcia, and, ARG Capital partner Miguel Iribarne, are raising the cash from accredited family office investors in Argentina, Costa Rica and other Latin American nations.
The service is designed to give new crypto-asset investors exposure to bitcoin and ether without taking on the added risk of regulatory and tax compliance and storage. No fee is being charged for the service, but 30% of the carried interest will be collected by the fund based on certain conditions.
At the time of launch, the funds are expected to be held by Switzerland-based Xapo, with over-the-counter trading services provided by B2C2, an electronic market maker regulated by the Financial Conduct Authority in the UK, and broker funding provided by Silvergate Bank.
Half of all initial funds raised will be invested in bitcoin, with the other half divided between the remaining cryptocurrencies. Initially, the fund is open to accredited investors in Latin America, with a special focus on family offices Argentina and Costa Rica. But future funds could include new assets and other investors.
Funds will not be liquidated until 180 days after the next bitcoin halving, when the reward to mine bitcoin is reduced. Investors who put up a minimum of $2.5m will be allowed to hold their funds for the maximum period of five years.
"We are mainly targeting family offices in Latin America," said Garcia. "But there are other players interested in the fund, because the fund strategy also fits with what they’re looking for."
While bitcoin and other cryptocurrencies were originally heralded as new ways for the unbanked populations of developing countries to participate in the global economy, that has been changing in recent years.
As early use cases including remittances were targeted largely at workers looking to send money home, this latest development shows how services are now being aimed at the wealthy. CoinDesk first reported on this push by family offices into the cryptocurrency space last March.
Now, based on previous growth trajectories of CAF’s crypto-assets, the fund lists a minimum target return of 26% per year for three years with an "expected" target return of 71%.
But Garcia said Latin American family investors are looking for more than just a new way to make money. Depending on the nation, they are also looking for a way to hedge against less stable fiat currencies.
"Storing their savings in the local currency is not a smart option."
That rumble you hear is the sound of regulators around the world mobilizing resources to tackle the pressing matter of token sales.
Yet, in spite of the spectacular growth of blockchain token-based funding, no one seems to have a clear idea of what type of rules to introduce. The resulting uncertainty (not to mention ridicule) is left hindering progress as money flows to unviable projects and investors are left vulnerable to foul play – exactly what regulation is supposed to prevent.
Perhaps a new approach is needed.
But to see where this could go, it's worth stepping back and asking what we expect the regulation to do. Safety belt
First, why do we need regulation, not just of finance, but of anything at all?
To protect us. At its roots, that is the main role of government – to protect its citizens from avoidable harm and extreme loss brought about by others or from our own lack of common sense. When it comes to securities, that usually means stopping us from making poor decisions…
I have been a buyer and holder of bitcoin and Etherreum for a long time but this will be the first ICO I buy into--Duncan Logan.
What is Electroneum?
Electroneum (ETN) is a cryptocurrency that can be mined with a smartphone, requiring almost no technical knowledge or prior experience. This sets it apart from other cryptocurrencies (like Bitcoin) which require expensive hardware and technical know-how to mine.
Electroneum’s unique mobile mining experience allows anyone with a smartphone to earn ETN coins by letting the miner app run in the background.
It was designed specifically with mobile users in mind, thereby appealing to a potential market of 2.2 billion smartphone users around the world. Unlike other cryptocurrencies, Electroneum has a user-friendly, beginner-oriented interface that allows users to seamlessly transfer ETN coins between one another, check their balances, and mine coins.
Being a cryptocurrency, Electroneum is created, held, and spent electronically, and has no phy…
oila! Finally, the Inglourious Basterds script is here for all you fans of the Quentin Tarantino movie. This puppy is a transcript that was painstakingly transcribed using the screenplay and/or viewings of the movie to get the dialogue.
Inglourious Basterds Script(DISTANT RUMBLING)
(MEN SPEAKING GERMAN)
While I'm very familiar
with you and your family,
I have no way of knowing if
you are familiar with who I am.
Are you aware
of my existence?
This is good.
Now, are you aware of the job
I've been ordered to carry out in France?
Please tell me
what you've heard.
that the FÃ¼hrer has put you in charge
of rounding up the Jews left in France
who are either hiding
or passing for Gentile.
The FÃ¼hrer couldn't have
said it better himself.
But the meaning
of your visit,
pleasant though it is,
is mysterious to me.
The Germans looked through my house…