I logically agree with you when you say if it locks bitcoin up, regardless of custodian, then it's [representing] real bitcoin. That's assuming it's actually truly locking up bitcoin. Big big BIG (and dangerous) assumption though.
But even suspending disbelief and trusting that it is... it's a bit like a blood diamond. Yeah it's a diamond but what did it take to produce?
And worse yet what is it being used for? To scam more fools.
Perpetrated by the first family no less.