Brandon Lutnick leads a $3 billion Bitcoin venture with SoftBank, Tether, and Bitfinex through Cantor Fitzgerald. The funds will create 21 Capital and convert Bitcoin investments into corporate shares. However, uncertainties regarding the deal still exist. The project seeks to replicate the success of Strategy’s BTC holdings, amidst a recent price rally, emphasising the importance of Bitcoin’s future performance and regulatory climate.
Brandon Lutnick, son of US Commerce Secretary Howard Lutnick, is spearheading a significant Bitcoin investment initiative through Cantor Fitzgerald, collaborating with notable partners such as SoftBank, Tether, and Bitfinex. This venture aims to establish a Bitcoin (BTC) investment vehicle valued over $3 billion, coinciding with a recent recovery rally in Bitcoin prices.
According to the Financial Times, Lutnick’s special purpose acquisition company (SPAC), Cantor Equity Partner, raised $200 million in January, designated for the formation of a new firm named 21 Capital. Contributing partners will provide considerable Bitcoin amounts, with Tether planning a $1.5 billion BTC contribution, Bitfinex $600 million, and SoftBank $900 million, culminating in a total contribution of $3 billion.
Investment conversions will occur at a share price of $10, based on a Bitcoin valuation of $85,000 per coin. The SPAC intends to attract more funds via a $350 million convertible bond and a $200 million private equity placement for additional Bitcoin acquisitions. The Financial Times noted that while an announcement of the deal is expected soon, uncertainties regarding its realization persist.
The project’s objective is to mirror the success of Strategy, previously known as MicroStrategy, which holds 538,200 BTC worth approximately $50.14 billion, reflecting a substantial unrealized profit. Recent market activity has indicated a revival in Bitcoin’s price, surpassing the $90,000 threshold for the first time in seven weeks, with a 5.3% increase leading to a current trade at $92,862.
As the consortium progresses, its future success is contingent upon Bitcoin’s sustained performance and the evolving legal landscape concerning cryptocurrencies. Analysts within the sector are observing these developments closely as potential market shifts unfold.
