Documents were filed by Bitcoiner Chamath Palihapitiya to raise $250 million for American Exceptionalism, a prospective SPAC with a focus on the DeFi, AI, energy, and defense sectors.
Documents were filed by early Bitcoin investor and billionaire Chamath Palihapitiya to raise $250 million for a blank-check company, “American Exceptionalism Acquisition Corp A,” which is targeting the decentralized finance, AI, energy, and defense sectors.
The special purpose acquisition company (SPAC) would be led by Steven Trieu, a managing partner at Social Capital, as its CEO, and Palihapitiya as its chairman, according to a registration statement that was filed with the U.S. Securities and Exchange Commission on Monday.
A raise of $250 million is being sought to offer 25 million shares at $10 each under the ticker AEXA on the New York Stock Exchange.
A bet is being made by Palihapitiya and Trieu on decentralized finance, not Bitcoin, to lead the next wave of financial innovation, with a focus on solutions that bridge traditional markets with blockchain technology.
While Mr. Palihapitiya has long been a proponent of Bitcoin as an inflation hedge and alternative to fiat currencies, we believe that the next stage of development is the increased integration between traditional finance and decentralized finance.
DeFi Can ‘Disintermediate’ TradFi, and Circle is the Proof, Executives Argue
The success of stablecoin issuer Circle Internet Group’s recent public listing was pointed to by the pair, who stated that it “demonstrated how decentralized finance can be used to disintermediate traditional finance intermediaries and provide clear value for customers via reduced friction.”
It was acknowledged by the venture capitalists that the path toward mainstream acceptance of crypto and stablecoins has “taken longer than expected,” but that path “now appears to be inevitable.”
A Look at Chamath Palihapitiya’s Mixed Track Record with Past SPACs
Several high-profile SPACs were led by Palihapitiya during 2020 and 2021, including successful mergers that involved Social Capital Suvretta Holdings I and Social Capital Hedosophia Holdings V, which are now operating as SoFi Technologies.
However, other SPACs led by Palihapitiya, such as Social Capital Suvretta Holdings II, III, and IV, were liquidated, which gives him a mixed record.
Challenges are faced by SPACs because they are bound by strict time limits to find a private company to merge with, they often struggle to identify companies that are worthy of high valuations, and they operate under a great deal of regulatory scrutiny.
Palihapitiya’s SPAC Filing Comes After He Once Denounced Crypto in America
The naming of Palihapitiya’s American-themed SPAC comes two years after the crypto industry was declared “Dead in America” by him, with former SEC Chair Gary Gensler being pointed at for pursuing dozens of high-profile lawsuits against crypto firms.
Gensler’s crackdown was labeled by critics as part of “Operation Choke Point 2.0,” which is an alleged coordinated effort by regulators to pressure banks into distancing themselves from crypto firms.
Many of those cases, including those against Coinbase and Ripple, have been dismissed under the new crypto-friendly SEC led by Paul Atkins, which has also had a Crypto Task Force created to provide clearer rules while balancing innovation with consumer protection.
