Shares of Twenty One Capital Rise Following Tether’s Merger Proposal
Shares of Twenty One Capital (XXI), a company centered on Bitcoin investments, experienced an increase of over 8% in after-hours trading on Wednesday. This surge follows a merger proposal from its majority stakeholder, Tether Investments, which aims to unite XXI with Strike and Elektron Energy.
Tether Investments, known as the independent investment division of the stablecoin issuer, announced plans to support the merger. They expressed their intention to vote in favor of merging XXI with Strike—a global financial services entity for Bitcoin founded by Jack Mallers—and Elektron Energy. Mallers also serves as the CEO of XXI.
A press release highlighted that the successful completion of these transactions could pave the way for XXI to emerge as a leading publicly traded Bitcoin firm globally. This would integrate Bitcoin treasury management, mining operations, financial services, lending offerings, capital markets activities, and strategic consolidation into one cohesive structure.
No specific details regarding timelines for this merger have been shared as of yet.
Elektron Energy, under the leadership of Raphael Zagury, currently manages around 5% of the total computing power within the Bitcoin network, with production costs averaging below $60,000 per Bitcoin.
Additionally, Tether proposed that Zagury take on the role of President in the new consolidated entity, which would blend his expertise in mining and capital markets with Mallers’ acumen in product and consumer-focused Bitcoin initiatives.
XXI became publicly traded in December through a SPAC merger with Cantor Equity Partners. Initially entering into the market as a bitcoin treasury firm holding 43,514 BTC, it has received backing from Tether, Bitfinex and Mallers himself. At that time, XXI emphasized its goal of “capital-efficient bitcoin accumulation.”
If this new merger materializes, it would signify an expansion from their original treasury focus into broader aspects of Bitcoin-related services. The press release indicated that “the combined transactions would propel XXI beyond mere treasury exposure toward establishing a platform encompassing operating businesses and recurring revenue streams along with long-term Bitcoin accumulation capabilities.”