BTC Capital

[TheFund]

I recently put together a site to explain my idea of a bitcoin fund. I would appreciate any feedback on the idea or site. Thank you.

http://thebtcfundmanager.wix.com/btccapital

Edit: This isn't what the actual site will be like. I would obviously purchase a domain and have one professionally made. Just something I put together in a couple hours to be able to get feedback on the idea.

[9inety7even]

You should probably get an actual domain if you want people to take you seriously. Somebody who can't afford $10 a year to seem professional is not going to be trusted with any of my money.

[bigasic]

I agree with the previous poster. Also, if you want to advertise or work in the USA, youll have to get SEC approval. I think ideas like yours are great and could be successful but the work to get legal is extensive and expensive. I think this is what the winklvoss bros are trying to do, if not its similar.

Edit...I think what you have is pretty unique, btc mining, ltc mining, bitcoins, etc, so its not like the winklvoss twins idea. but I do believe that you will have to  jump thru all the SEC hoops to do this in the USA, but it still may work outside North America. Youll probably have to check each countries law before advertising. I know that the SEC in the States are going after no licensed companies like crazy.

[TheFund]

I appreciate the feedback. This isn't something I'm planning to launch immediately so I just made a quick mock version of what the site could be like. It's an idea that I've been working on for a few weeks now so very new.

I haven't looked into the legal side of it yet. I was hoping someone here would be able to help me out with that part. Any advice on where to start?

[worle1bm]

I think you are putting the cart before the horse. What makes you qualified to invest large amounts of other folks money? How are you generating returns? And a "diverse" portfolio isn't always a hedge against risk, else everyone would do simply that.

[TheFund]

I believe my Investments degree and experience with the stock market makes me qualified to invest money. Returns are generated through the cloud mining companies as stated on the website. A diverse portfolio is definitely a hedge against risk in the world of cryptocurrency. Try diversifying $10. Try diversifying $100. This is the EXACT reason mutual funds exist.

[worle1bm]

I believe my Investments degree and experience with the stock market makes me qualified to invest money. Returns are generated through the cloud mining companies as stated on the website. A diverse portfolio is definitely a hedge against risk in the world of cryptocurrency. Try diversifying $10. Try diversifying $100. This is the EXACT reason mutual funds exist.

You have a degree in investments? Never heard of that.

The world of cryptocurrency is extremely volatile and diversity amongst extremely volatile assets doesn't limit that volatility. I don't think you should be investing money for other people.

[TheFund]

It's a bachelors degree in Investments from the University of North Dakota where I managed over a million dollars of other people's money very successfully. Diversifying between risky assets is exactly limiting risk. If you throw all your eggs in one basket and the basket breaks, then you're done. If you diversify and one egg breaks, then you continue.

I don't think you should give advice about things you obviously don't understand.

[9inety7even]

There's a big difference between investing in the stock market at a university and investing in unregulated securities with the money of people you met in a forum. Being decent at one means nothing in terms of the other.

[TheFund]

I agree that there is a major difference between the stock market and unregulated securities. It's not like I'll be day trading different cryptos. I'll be building a diversified portfolio that combines cloud mining companies and other investments I may find that meet the standards needed to be held by the fund. This will include holding btc and/or ltc with very little trading. I've read many posts from people invested in cloud mining companies that are looking to diversify but can't afford to spend more on their crypto venture. I've also read about people investing everything into one company and the company eventually tanks (or runs) and brings down all the invested bitcoin with them. I think having a diversified portfolio is a much needed safer alternative for smaller investors, specifically investors looking to get into bitcoin for the first time.

[railzand]

https://bitcointalk.org/index.php?topic=124441.0

[TheFund]

It appears that this type of fund would not be regulated by the SEC. I contacted them and they informed me that:

"Section 202(a)(11) of the Act defines an investment adviser as any person or firm that:
 for compensation;
 is engaged in the business of;
 providing advice to others or issuing reports or analyses regarding securities.
A person must satisfy all three elements to fall within the definition of “investment adviser”

"The SEC staff has stated that advice about real estate, coins, precious metals, or commodities is not advice about securities"

"IRS treats Bitcoin as property"

Therefore, any investment advice regarding Bitcoin is not regulated by the SEC. I am definitely looking to move forward with this project if the interest is there. If anyone has ideas on how to better this project, then I would be open to hearing them/taking on a partner. Preferably someone well known in the community since I am a new name around bitcointalk.

[worle1bm]

https://bitcointalk.org/index.php?topic=124441.0

I really think you should check this out and consider it.

[TheFund]

Already did. I opened a WOT account. I can't help the fact that I haven't been on this forum for 6 months. I've been on Hashtalk for 2 months. The cryptocurrency landscape can change way too much in 6 months. I decided to reach out for a partner who has an established reputation after reading the link.

[worle1bm]

Have you managed funds or a portfolio professionally? Do you have any history that investors could look at regarding crypto, like a 6 month performance audit of trades and investments? How will you hedge the risk of loss in an unregulated environment? Do you have any type of insurance on funds you manage? Do you have relationships with any LP's in case you need liquidity? What are your return benchmarks and how will you handle early withdrawal? What percentage will you keep liquid? How will you provide transparency? etc. etc. etc.

[TheFund]

I have never managed funds on a professional level. I have headed the Health Care sector of a $1.3 million portfolio. I will gladly disclose all my trades regarding crypto and any investments I currently have in crypto related businesses. The risk of loss in unregulated environments is high, but there is a risk of loss in regulated environments as well. The risk is spread across multiple companies and assets to avoid any one company/asset from causing a high loss. An LP is not necessary for this fund as one of the main purposes is to earn a return through cloud mining companies. Bitcoin and Litecoin will also be held by the fund for liquidity purposes. There is no return benchmark for this fund since it is entirely unique. Not a single fund exists anywhere close to this one. There isn't a maturity date on this fund so I'm not sure why you're asking about early withdrawal risk. It acts like a hedge fund not a 401k so it's not relevant. The liquidity percentage will depend on market conditions at the time of the initial offering. Transparency will be provided directly from the companies held in the portfolio.