Winklevoss twins file for $20 Million IPO of bitcoin trust fund
The Winklevoss twins filed with the U.S. Securities & Exchange Commission (SEC) for a bitcoin investment fund
The Winklevoss twins have filed with the U.S. Securities and Exchange Commission (SEC), for an investment fund based upon their substantial holding of bitcoin. The Winklevoss Bitcoin Trust is sponsored by a company the pair created called Math-Based Asset Services LLC. The Winklevii (as they are known) hope to expose more investors to the potential gains (and losses) of bitcoin.
The S-1 form can be read in full here. The Winklevii told the New York Times in April that they had a portfolio of (at the time of writing) $11 million worth of bitcoin. That holding reportedly represents 1% of all bitcoin in circulation.
Given the volatility and regulatory uncertainty surrounding bitcoin, it is understandable that many traditional investors have held back from taking a position on bitcoin. However, the Winklevii state in the SEC filing that:
Therefore, the Winklevoss proposition may serve to tempt in more mainstream and conservative investors to put their money into bitcoin. Helping bitcoin to gain acceptance is just what the Winklevoss twins seem to be working on. At the Bitcoin 2013 conference, they called for bitcoin businesses to work with their governments and stated that cooperation was the way forward.
The SEC filing goes on to explain that shares are purchased in blocks of 50,000 – known as "Baskets", that will be indivisible.
Later in the filing, the "Plan of distribution" explains that it allows "authorized participants" to receive Baskets in exchange for bitcoin on a continuous basis. The trust states that it will not issue fractions of Baskets as shares will be created on an ongoing basis. However, such authorized participants are free to sell any fraction of shares to their clients.
The filing also cautioned that it was not directly responsible fo the development of the Bitcoin network, and that "the sponsor and its management have no history of operating an investment vehicle like the Trust, their experience may be inadequate or unsuitable to manage the Trust".
We will update this story with more information as we receive it.
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