Bitcoin-Based Life Insurer Opens for Business
Bermuda-based carrier is entirely denominated in Bitcoin.
Like Matt Sitzmann at Castle Funds, fintech entrepreneur Zac Townsend sees nothing wrong and a lot right in selling life insurance products invested in crypto.
The main difference between Castle Funds’ insurance-dedicated fund and Meanwhile, the unusual name of Townsend’s company, is that Bitcoin comprises the entirety of the latter’s invested assets.
“We launched a full life insurance carrier in Bermuda that’s entirely denominated in Bitcoin,” says Townsend, Meanwhile co-founder and CEO. “We take premiums in Bitcoin, pay claims in Bitcoin, and do the audited financials in Bitcoin. What’s nice about that is all our assets and liabilities are matched.”
The life insurer sells one product, “dead simple whole life insurance,” which is regulated by the Bermuda Monetary Authority, Townsend says. “You pay like 1 Bitcoin a year for 10 years, and we promise you some fixed payout like 15 Bitcoins or 20 Bitcoins, depending on your age and health. We’ve designed the product to comply with all the rules in the U.S. Although we’re domiciled offshore, people in the U.S. can come to us to buy whole life insurance.”
By “people,” he means sophisticated high-net-wealth investors. “Whole life insurance has a ton of tax benefits,” Townsend says. “Investors can borrow from the policy tax-free. Since it is denominated in Bitcoin, if the price of Bitcoin goes up, they can borrow against it tax-free.”
Meanwhile doesn’t invest in advertising or marketing but has generated free word-of-mouth attention from well known financial backers like Sam Altman, the embattled CEO of OpenAI, whose removal and brisk reinstatement as chief executive of the artificial intelligence developer in November 2023 was front-page business news. Altman co-led one of Meanwhile’s two seed funding rounds, which together raised $19 million at a $100 million valuation. Like Castle Funds, Meanwhile’s custodian bank is Anchorage Digital Bank.
At press time, the company had sold some life insurance policies, but Townsend would not specify the number. He recently talked with several insurance brokers who specialize in wealth management and estate planning for high-net-wealth individuals, commenting, “It went well. They were excited to have an option since they were receiving inquiries from clients about Bitcoin.”
Asked about concerns over cryptocurrencies as a money laundering vehicle for terrorists, ransomware gangs, drug dealers and rogue states, Townsend says crypto “can be a vector for money laundering sometimes, but we have a very good regulator in Bermuda, the most respected offshore jurisdiction. Sometimes, I think I’m running an anti-money-laundering company. We take compliance very seriously.”
