Tether, Cantor, and Softbank discovered that Twenty One amassed Bitcoins.
In a significant move for the cryptocurrency market, a new Bitcoin-centric company named Twenty One has been launched with an initial funding of $585 million. The company, founded by Brandon Lutnick, son of US Trade Minister Howard Lutnick, and Cantor Equity Partners, aims to maximize the number of Bitcoins per share.
Twenty One's backing comes from some of the biggest names in the industry. Tether, the stablecoin issuer, contributes Bitcoins worth $1.5 billion, making it the main shareholder alongside its sister company, Bitfinex. Japanese technology conglomerate SoftBank, which has been active in the crypto market since around 2020, invests $600 million. This investment includes Web3 infrastructure, the bankrupt exchange FTX, and the Brazilian exchange Mercado Bitcoin.
Tether currently holds around 100,000 Bitcoins as part of its asset portfolio, and it is these Bitcoins that form the basis of Twenty One's initial holdings. After the transfer of these bitcoins to Twenty One, Tether no longer holds ownership. Jack Mallers, founder of Strike, a Lightning app, will be the CEO of Twenty One.
The goal of Twenty One is to aggressively accumulate bitcoins through capital raises, with almost exclusive financing by bitcoin. The company starts with 42,000 Bitcoins, currently worth approximately four billion dollars. This significant hoard of bitcoins could potentially serve as a vehicle for Tether to convert some of its Bitcoins into another form, complying with future regulation.
The US is considering regulating stablecoins with the GENIUS Act, which may require Tether to shift its assets off the balance sheet. This move could further solidify Twenty One's position in the market. Companies like MicroStrategy and now Twenty One will play a significant role in converting parts of the dollar flood into national bitcoin reserves, preparing the U.S. for Bitcoin to replace the dollar as the global reserve currency.
Twenty One plans to raise additional capital through publicly offered convertible notes. The company's ambitious plans are a clear indication of the growing interest in Bitcoin and the potential it holds for the future of finance.
