On May 13, 2024, Twenty One Capital undertook a significant purchase of 4,812 Bitcoin, valued at approximately $458.7 million, as outlined in a filing with the United States Securities and Exchange Commission (SEC). This strategic acquisition aligns with the company’s merger with Cantor Equity Partners through a Special Purpose Acquisition Company (SPAC) framework. At the time of this transaction, Bitcoin was trading at around $103,540, reflecting notable price movements in the digital currency market.
How Did the SPAC Merger Influence This Purchase?
The acquisition was facilitated by stablecoin power player Tether. On May 9, these Bitcoins were initially placed in an escrow wallet before being transferred to a wallet under Tether’s control. This stockpile of cryptocurrency will be sold to the publicly held Twenty One Capital under their SPAC merger arrangements involving Private Investment in Public Equity (PIPE).
What Role Do Partnerships and Management Play?
Jack Mallers, the visionary behind the Bitcoin payment application Strike, leads Twenty One Capital. After the merger, Twenty One Capital’s trading symbol will change to XXI from its current CEP. Notably, the SPAC initiative is supported by Wall Street’s Cantor Fitzgerald. This merger augments the firm’s Bitcoin tally to 36,312, with Cantor Equity Partners controlling the majority.
Tether, alongside Bitfinex, holds major shares in the entity, while SoftBank is a minority investor with $900 million on the table. Besides endorsing the merger, Cantor Fitzgerald champions a $585 million reserve earmarked for prospective Bitcoin purchases.
The company aims for Bitcoin reserves to reach 42,000 through its IPO plans, acquiring 23,950 from Tether, 10,500 from SoftBank, and 7,000 from Bitfinex, translating into equity shares priced at $10.
Following the Bitcoin procurement, Cantor Equity Partners’ shares soared, climbing from $10.65 to $59.73, and stabilizing at $29.84. Additional filings report a 5.2% increase in after-hours trading.
• Twenty One Capital ranks as the third-largest Bitcoin institutional holder.
• The company focuses on Bitcoin accumulation per share as its performance metric.
• Major strategic partners include Tether, Bitfinex, and SoftBank.
• Cantor Fitzgerald supports Bitcoin expansion with a considerable investment fund.
As Bitcoin nears $103,540, market interest intensifies. Analysts, including Michaël van de Poppe, propose that low inflation and potential FED rate cuts could make cryptocurrencies more appealing. ColinTCrypto connects BTC‘s upward trajectory to money supply dynamics, suggesting prices may soon surpass $120,000.
Twenty One Capital’s notable move underscores the growing institutional engagement with digital currencies. As the company prepares for its IPO, its burgeoning Bitcoin collection attracts widespread attention. Emphasizing Bitcoin per share instead of conventional KPIs hints at an industry shift. The increasing involvement of sizable investors is reshaping the cryptocurrency landscape, as analysts weigh the influence of broad economic indicators alongside institutional strategies to predict future highs.
