Winklevoss Twins Submit Bitcoin Proposal
The brothers, famous for their spat with Mark Zuckerberg, aim to bring the digital currency into the mainstream.
Cameron and Tyler Winklevoss, the blue-blooded twins famous for their legal battle with Facebook's Mark Zuckerberg and portrayal by Armie Hammer in The Social Network, have filed a proposal for an exchange-traded fund that would bring investing in bitcoins, a digital currency, into the mainstream.
The filing on Monday, pending approval from U.S. securities regulators, outlines a plan that could make the virtual money trade-able, just like a stock, by any investor, The New York Times reports. The Winklevoss Bitcoin Trust "eliminates the friction of buying and reduces the risks associated with storing bitcoin while offering similar investment attributes to direct ownership," said Tyler, whose Math-Based Asset Services would manage the fund.
Bitcoins, introduced in 2009 by an anonymous hacker or team of hackers, lack backing from central banks and are generated after a user completes a complicated math problem. They are primarily used among digital early-adopters, including programmers, and a single bitcoin is valued at around $100, which puts the total market worth in the ballpark of $1 billion, according to the Times. So far, some 11 million bitcoins have been created; if their fund is approved, the Winklevosses would purchase one bitcoin for every five shares, thereby rendering the worth of a single share about a fifth of a solo bitcoin.
But there are obstacles and risks such as "an uncertain regulatory landscape," said the Winklevoss' submission. Mt.Gox, based in Tokyo, is the largest bitcoin exchange in the world; it recently registered with the Financial Crimes Enforcement Network of the U.S. Treasury Department to establish itself as a money-service business amid money-laundering scrutiny and stigma over virtual currency, said the Times.