The stablecoin giant’s latest move accelerates a high-stakes merger and positions a new player to challenge Bitcoin’s corporate giants. Tether just dropped $458.7 million on Bitcoin, snapping up 4,812 coins for Twenty One Capital. The purchase, finalised May 9 at $95,319 per Bitcoin, signals aggressive confidence in the crypto firm’s future. Now, Twenty One’s reserves balloon to 36,312 BTC as it races to close a merger with Cantor Equity Partners. Once complete, the combined entity will trade under the ticker XXI, a potential game-changer for investors seeking Bitcoin exposure without direct crypto custody. Furthermore, Twenty One’s Jack Mallers confirmed the merger is under regulatory review but stayed tight-lipped on timelines. The deal, backed by Wall Street titan Cantor Fitzgerald, has already sent shockwaves through markets. Cantor’s stock swung wildly in May, peaking at $59.73 before settling at $29.84. Following Tether’s purchase, shares jumped 5.2% after hours.
Behind the SPAC
Twenty One isn’t just stacking Bitcoin; it’s building an empire. The firm aims to hit 42,000 BTC by its public launch, leveraging contributions from Tether, SoftBank, and Bitfinex. Tether alone plans to inject 23,950 BTC, while SoftBank adds 10,500 BTC and Bitfinex chips in 7,000. Converted to equity at $10 per share, these stakes could reshape ownership dynamics. Cantor Fitzgerald’s role as merger sponsor adds firepower. The firm secured $585 million in funding, including $385 million in debt, to fuel Twenty One’s Bitcoin buys. Notably, Cantor already holds 99% of Tether’s U.S. Treasury reserves, deepening their alliance. For investors, the pitch is clear: a “pure play” Bitcoin vehicle with institutional-scale dollar-cost averaging.
Strategy’s Crown Threatened
Twenty One isn’t hiding its ambitions; it wants to dethrone Michael Saylor’s Strategy (formerly MicroStrategy) as Bitcoin’s top corporate holder. With 568,840 BTC, Strategy dominates, but Twenty One’s rapid ascent to 36,312 BTC places it third, trailing MARA Holdings’ 48,237 BTC. An April SEC filing vowed to become the “superior vehicle” for Bitcoin exposure, prioritising “Bitcoin per share” over traditional profit metrics. The firm plans to leverage Bitcoin-native services like lending and reserves management, distancing itself from Strategy’s software roots. Additionally, Twenty One aims to produce Bitcoin-focused media, betting on adoption through education. Still, critics question if its complex SPAC structure can deliver for retail investors long-term.
Heavyweight Backers and Shifting Ownership
Tether and Bitfinex parent iFinex will control 58.8% of Twenty One post-merger, with SoftBank holding 24%. Tether’s $1.6 billion Bitcoin commitment aligns with its policy to allocate 15% of profits to BTC, a strategy that netted $13 billion in 2024. SoftBank’s $900 million injection, though a minority stake, adds credibility and liquidity. Jack Mallers, Strike CEO and Bitcoin advocate, helms the venture. His vision merges Wall Street rigour with crypto-native innovation, targeting investors leery of direct crypto ownership. Meanwhile, Cantor Fitzgerald’s financial muscle ensures access to capital markets, a critical edge in Bitcoin’s volatile landscape.
Market Euphoria
Bitcoin’s price is now above $100,000. Enthusiasts cheered the move online, calling it a “bullish masterstroke.” Yet Cantor’s stock volatility shows market fears. Shares skyrocketed 460% in early May before plunging 50% days later, a rollercoaster reflecting SPAC risks. Critics like investor @OccamiCrypto warn Tether and Bitfinex could be “washing profits” through the deal, favouring insiders over small shareholders. Others highlight regulatory uncertainty, though the Trump administration’s pro-crypto stance, including a proposed Bitcoin reserve, supports hopes.
Risks and Rewards
Twenty One’s success hinges on Bitcoin’s price trajectory and merger execution. Its $3.6 billion valuation assumes Bitcoin stays above $85,000 a gamble in a famously unstable market. The firm’s heavy debt load and focus on Bitcoin accumulation could strain liquidity if prices dip. Still, the merger bridges crypto and traditional finance, offering investors a regulated path to Bitcoin exposure. If successful, Twenty One could pressure rivals like Strategy to innovate or risk obsolescence. For now, all eyes are on regulators and Bitcoin’s next move.
Written By Fazal Ul Vahab C H
