Twenty One Capital has launched with USD 3.6 billion in Bitcoin, supported by Tether, SoftBank, and Bitfinex through a reverse merger with Cantor Equity Partners. The firm plans to acquire more Bitcoin and aims to emulate the successful strategy of MicroStrategy. The venture coincides with an elevated Bitcoin price environment and a potential shift in regulatory attitudes towards cryptocurrencies in the US.
Twenty One Capital has officially launched, boasting a significant start with a whopping USD 3.6 billion in Bitcoin. The firm, backed by notable players like Tether, SoftBank, and Bitfinex, marks a new venture into cryptocurrency investment. This operation comes into play through a reverse merger with Cantor Equity Partners, a special purpose acquisition company (Spac) that previously garnered USD 100 million this year.
The intention behind this initiative is to meet what backers refer to as a rising demand for substantial Bitcoin exposure. The brain behind this approach takes a cue from MicroStrategy, which pivoted towards Bitcoin, experiencing a notable increase in its market valuation. This strategy seems to be taking off as firms seek to mirror that success in a changing financial landscape.
Currently, the valuation of Twenty One Capital stands at around USD 3.6 billion, factoring in the existing debt and based on a Bitcoin price set at USD 85,000. The firm plans to leverage both its current digital assets and additional funding to acquire even more Bitcoin. Initial contributions are being made by Tether, Bitfinex, and SoftBank, with Tether slated to contribute a significant portion of approximately USD 1.5 billion in Bitcoin.
To support its goals, Cantor Equity Partners is also looking to raise more cash through a USD 385 million convertible bond issuance and a separate USD 200 million in private equity. The leadership of this new entity includes a notable executive from the Bitcoin purchasing platform Strike, indicating a strategic choice aimed at making the most of experienced leadership in the crypto space.
This launch is just one chapter in a larger trend of Spac activity affiliated with Cantor Fitzgerald, which has begun several similar initiatives targeting acquisition opportunities in the crypto world. Given the rising institutional interest, insiders hope this venture can offer robust Bitcoin exposure at a crucial time.
Interestingly, the timing coincides with a dynamic Bitcoin price climate. Bitcoin recently peaked above USD 106,000 following the 2024 US presidential election but has since stabilised around USD 93,000 per coin, as reported by the Financial Times. Additionally, the current US administration appears to be shifting toward a more favourable regulatory attitude regarding cryptocurrencies, which could pave the way for increased institutional engagement in the sector.
