Genesis Mining Files With SEC for Bitcoin Mining Fund
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Genesis Mining, the world’s largest Bitcoin cloud mining provider, has announced the launch of the world’s first regulated Bitcoin mining fund. The fund, to be called Logos Fund, has officially filed its Form D with the SEC. According to the fund’s website, the fund will also allow investors to gain exposure to bitcoins directly (in addition to Bitcoin mining operations).
Why Start a Bitcoin Mining Fund?
According to Genesis Mining, the company has received more than $100 million in inquiries involving Bitcoin mining over the past two years. While many Bitcoin enthusiasts have purchased their own equipment and started their own mining operations in recent years, the reality is that this process is not attractive to many professional investors.
The Logos Fund is intended to be a professional investment vehicle targeted at high net worth clients. More specifically, Genesis Mining CEO and co-founder Marco Streng told Bitcoin Magazine, “The fund will be accessible on request for accredited investors.
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“When you receive $100 million worth of inquiries from big-time investors looking to enter the market, you’d be foolish not to listen and build a solution,” Streng said.
In terms of what types of investments will be made by the fund, Streng told Bitcoin Magazine:
“We think mining is a huge opportunity for large-scale investors and we are bullish on the future value of Bitcoin. Our initial strategy will be to generate bitcoins for our investors for the lowest price possible, giving them access to what we feel is the most exciting investment class that has existed in decades.”
Management of the Logos Fund
Björn Tilmann Arzt and Dr. Florian Putzka are currently listed as the two managers of the fund. Arzt has worked with Genesis Mining and as a structurer for a major European investment bank. Putzka’s experience is as a qualified German legal counsel specializing in contract and bank law.
Genesis Mining will be providing $1 million of its own capital to the Logos Fund. When asked what this initial capital would be used for, Streng told Bitcoin Magazine:
“All capital will be invested in mining infrastructure and further developing its operability and production capacity in advance of outside investors joining the fund.”
Streng added, “At this stage, most of the investments will be in Genesis Mining operations due to our ability to get the lowest priced electricity and hardware, giving our investors the most efficient mining operations that exist.”
Unregulated Bitcoin Mining Funds Have Existed Before
Although the Logos Fund will be the first legal, regulated Bitcoin mining fund, there were also a few funds offering exposure to the Bitcoin mining industry in the early days of bitcointalk.org. MiningCo.ETF was a fund traded on the now-defunct BTC-TC and BitFunder exchanges. Carnth, the creator of the fund, described it as a way to “allow investors to instantly diversify among higher quality mining assets.”
There was a large amount of financial experimentation in the early days of Bitcoin. Some of these activities were nothing more than scams and Ponzi schemes, while others, such as MiningCo.ETC, were well-intentioned products, which could possibly be viewed as precursors to some of the new investment vehicles seen in the space today.