A Little Levity
The Vanishing Point: A Comedy in Four Acts
Written by Brian Montebank
Dedicated to Pierre Beaumarchais
Introduction
Wall Street may not appreciate the Blockfusion–Blue Acquisition Corp deal, but it's Broadway pure gold. All that's needed is a clever playwright to compose the separate vignettes into a Commedia dell'Arte play. That's not to say that the original business proposal is without merit. All it needs to succeed is $900 million in investment funding. I see that as an excellent premise for a street skit.
An attention-getting feature of the plot is the involvement of Retired Gen. Wesley Clark in the role of El Capitano. He has played the role before and still fits the role's costume. Recent news reports tell of his entering into a gentleman's agreement with Alex Martini-Lo Manto — CEO of a Silicon Valley-type company called Blockfusion — playing the Commedia dell'Arte role of Scapin: the entrepreneur.
First Act
The curtain opens on a vast, Salvador Dalí vista known as the Burning Man playa. It is a bizarre capriccio of acrobatic performances, special effects, and intoxicating beauty. The keynote of the event is vision. If attendees are not visionaries before the event, they will certainly be visionaries afterwards. The players scheme to launch a money-making venture by leveraging the charismatic Captain Clark's little black book of connections.
Second Act
The scene shifts to a nightclub in New York's chic loft district. At the club, El Capitano and Scapin encounter a mysterious figure wearing the Commedia dell'Arte mask of il Vecchio (also known as Shylock). He represents a company called Bit Digital. Vecchio is induced to invest in the Blockfusion–Blue Acquisition Corp deal. The smooth-talking Scapin discloses the merger proposal (sotto voce) thus:
"Blockfusion was built to deliver dependable, cost-efficient compute at scale," Scapin whispers, taking a sip of his Scotch, and continues: "We converted a retired coal facility into a clean energy-powered data center and showed we can execute complex infrastructure projects with accuracy and discipline. That capability lines up with what the AI market needs as demand for power and high-density capacity accelerates."
Vecchio is convinced. He duly writes a check for $5 million — and picks up the tab for drinks.
Third Act
The curtain opens on an obscure location generally to be found somewhere in upstate New York. Blockfusion purchased a coal-burning power plant and converted it into a cryptomining data center, hosting rigs for concerns like Bit Digital. It is a bleak backdrop. In May 2022, the site suffered a transformer explosion and fire. After completing repair work, the company halted operations following a new ordinance that led to a cease-and-desist order. The site was finally granted permission to reopen, and shortly thereafter, Blockfusion announced a partnership with Nano Nuclear Energy to deploy the latter's microreactor technologies at the Niagara site.
El Capitano, Scapin, and il Vecchio enter the stage, walking through the facility.
Vecchio: Is this a crypto mine, or an EPA Superfund site?
Scapin: (aside) He should have seen it before we cleaned it up. (aloud) "Right this way to the uranium pile."
Vecchio: Where is the pile of gold? I was hoping for something a little more in the way of Fort Knox. (smirks)
Capitano: Patience, sir; the secret of investing is patience.
Vecchio: Indeed. HODL is the safeword of the day.
Scapin: Look at the rows of servers — they seem to go on and on to the vanishing point, like a Renaissance perspective painting.
Vecchio: I want to know why my money vanished. Where is it?
Scapin: I was getting to that. Your $5 million was invested in cryptocurrency — but relax, we own the exchange. You will be pleased to know it funds our mining operations. Come along, now.
Vecchio: Show me the money.
Scapin: It's right there, on the blockchain.
Vecchio: Cash out my tranche immediately — in USD.
Capitano: En garde, sir. Your money is secure.
Scapin: You are a preferred shareholder. You own us. Gramercy!
Vecchio: Listen here, you Cagliostro — give me my money back, or I'll sue!
Postscript
It turns out Bit Digital invested $5 million to help Martini-Lo Manto get Blockfusion up and running.
Martini-Lo Manto decided to attempt a merger of Blockfusion with tech investment firm Blue Acquisition Corp., where — incidentally — Gen. Clark (El Capitano) serves as chairman.
Subsequently, Bit Digital accused Martini-Lo Manto — in court filings — of structuring the merger so as to conceal the $5 million investment: to "launder" it, in other words.
In short, Bit Digital accuses Martini-Lo Manto of engineering crypto fraud to avoid repaying the debt. The suit seeks to stop the projected merger, recover the money Bit Digital claims it is owed, accuse Gen. Clark of complicity, and determine — by discovery — what compensation he received.
The usual protests of "meritless" and "nuisance claim" have been returned, citing a "Delaware court decision which has already dismissed..." and asserting that "the claims have no basis in fact or law, and should be dismissed in their entirety."
In addition to halting Blockfusion's planned special purpose acquisition company (SPAC) merger, the lawsuit pleads for restitution of applicable interest and legal fees.
(to be continued)