Twenty One Capital: A new Bitcoin treasury company enters the arena

In a significant development for the Bitcoin corporate treasury space, Twenty One Capital, Inc. has announced its entry into the market through a definitive agreement for a business combination with Cantor Equity Partners, a special-purpose acquisition company (SPAC) sponsored by an affiliate of Cantor Fitzgerald.

The newly formed entity, which will trade under the ticker symbol “XXI” after closing, is set to launch with over 42,000 Bitcoin, immediately positioning it as the third-largest Bitcoin treasury in the world. While this falls short of Strategy’s current holdings of 538.200 Bitcoin, it represents a substantial entry into a space where Strategy has been the dominant player.

Twenty One will be majority-owned by Tether, the world’s largest stablecoin issuer, and Bitfinex, with significant minority ownership by SoftBank Group. The company will be led by CEO Jack Mallers, a well-known figure in the Bitcoin space who founded Strike, a payment provider built on Bitcoin’s Lightning Network.

Bitcoin-centric performance metrics

Similar to Strategy’s approach of focusing on Bitcoin yield and Bitcoin per share, Twenty One has announced plans to introduce two key performance metrics:

1. Bitcoin Per Share (BPS): Amount of Bitcoin each fully-diluted share represents
2. Bitcoin Return Rate (BRR): Rate at which BPS grows over time

These metrics align closely with Strategy’s focus on Bitcoin per share (currently 0.00178004 BTC BTC per diluted share) and Bitcoin yield ( +10.97% year-to-date), suggesting that Twenty One is adopting a similar approach to measuring success in Bitcoin terms rather than traditional financial metrics.

Financing and valuation

The transaction values Twenty One at a pro-forma enterprise value of $3.6 billion, based on a Bitcoin spot price of $84,863.57 as of April 21, 2025. The deal is expected to provide approximately $540 million in proceeds to Twenty One, which will be used to purchase additional Bitcoin and for general corporate purposes.

The financing structure includes:

• A fully committed convertible senior secured notes PIPE of $385 million, convertible at $13.00 per share
• A fully committed common equity PIPE of $200 million at $10.00 per share
• $100 million of cash held in the trust account of Cantor Equity Partners

Additionally, Tether has agreed to purchase Bitcoin equivalent to the aggregate amount of the offerings, which will then be purchased by Twenty One upon closing. This approach ensures that Twenty One will have immediate Bitcoin exposure upon its public debut.

Comparing to Strategy’s model

While Twenty One’s approach bears many similarities to Strategy’s successful blueprint, there are several key differences and points of comparison:

Bitcoin holdings

Strategy currently holds 538.200 Bitcoin valued at USD 50.156 bln, significantly more than Twenty One’s announced 42,000 Bitcoin. This gives Strategy a commanding lead in terms of Bitcoin ownership, with 2.56% of the total Bitcoin supply.

Financial engineering approach

Strategy has pioneered the use of convertible bonds with ultra-low interest rates (currently averaging 0.421%), along with ATM equity offerings and preferred shares (STRK and STRF) to fund its Bitcoin acquisition.

Twenty One appears to be adopting a similar approach with its convertible senior secured notes, though the specific interest rates were not disclosed in the announcement.

Corporate focus

Twenty One has stated it intends to develop “a corporate architecture capable of supporting financial products built with and on Bitcoin,” including “native lending models, capital market instruments, and future innovations.” This suggests a potential focus on Bitcoin-based financial services beyond pure accumulation.

Strategy, while primarily focused on Bitcoin accumulation, has also begun exploring Bitcoin-backed financial products with its preferred stock offerings, suggesting potential convergence in business models over time.

Market implications

The entry of Twenty One Capital creates a new dynamic in the Bitcoin treasury space that has been largely dominated by Strategy. This competition could accelerate several trends:

1. Increased corporate Bitcoin adoption: Twenty One’s high-profile launch, backed by major players like Tether and SoftBank, could legitimize the Bitcoin treasury strategy for more corporations.

2. Innovation in Bitcoin-backed financial products: Competition between Strategy and Twenty One could accelerate the development of Bitcoin-native financial instruments and yield-generating strategies.

3. Market premium expansion: Strategy currently trades at a premium of 2.069x to its Bitcoin NAV. The introduction of a competitor with a similar model could validate this premium approach to valuation.

Outlook and challenges

Twenty One faces several challenges as it enters this space. Strategy has established first-mover advantage with its substantial Bitcoin holdings and financial engineering expertise. Strategy’s market capitalization of USD 92.25 bln reflects investor confidence in its approach and execution.

For Twenty One to successfully compete, it will need to demonstrate the ability to grow its Bitcoin holdings efficiently while managing its capital structure. Jack Mallers’ expertise in Bitcoin and Lightning Network development could provide unique advantages, particularly if Twenty One pursues Bitcoin-native financial products beyond simple accumulation.

As the Bitcoin treasury space continues to evolve, the competition between Strategy and Twenty One will likely drive innovation and accelerate institutional Bitcoin adoption, potentially benefiting both companies and the broader Bitcoin ecosystem.