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Tether Tightens Grip on Bitcoin Treasury Firm Twenty One With SoftBank Buyout
TL;DR
Tether has acquired SoftBank's entire stake in Twenty One Capital, removing the Japanese firm from the venture. SoftBank's investment, initially valued at nearly $1 billion, is now worth approximately $711 million.
Key points
- Tether acquired SoftBank's stake in Twenty One Capital
- SoftBank's investment was valued at nearly $1 billion
- Current valuation of SoftBank's stake is around $711 million
- SoftBank's exit caused board resignations at Twenty One Capital
- Twenty One Capital is temporarily non-compliant with NYSE rules
Mentioned in this story
TetherSoftBankTwenty One Capital
In brief
- Tether has acquired SoftBank’s stake in Twenty One Capital (XXI), completely removing the Japanese tech giant from the venture.
- Shares that SoftBank purchased for nearly $1 billion last year were valued around $711 million on Wednesday.
- SoftBank’s departure forced the immediate resignation of its board designees, leaving XXI temporarily non-compliant with NYSE rules.
Tether signaled on Wednesday that it is consolidating control over Twenty One Capital (XXI), a Bitcoin-buying firm co-founded by the stablecoin giant last year, by acquiring shares held by Japanese investment firm SoftBank—one of XXI’s biggest initial backers.
The leading stablecoin issuer has purchased 89.1 million shares held by SoftBank, representing the entirety of the firm’s stake in the venture, according to an SEC filing. Under an agreement established last June, SoftBank paid $999.3 million for the exposure.
Although the transaction’s actual financial terms were kept private, SoftBank likely absorbed a notable haircut on its investment, considering the company’s position was recently valued at $711 million, with shares changing hands at $7.98, according to Yahoo Finance.
XXI’s stock price is up nearly 5% on the day, yielding a market cap of $5.2 billion, yet shares remained down 83% compared to a year ago. Amid a burst of Bitcoin-buying firms on Wall Street last year, XXI’s stock price soared as high as $53, a peak notched before the company merged with a blank check firm created by Cantor Fitzgerald.
Bolstering its majority ownership of XXI, Tether said in a blog post that the move underscores its conviction in the Bitcoin-buying firm co-founded alongside Strike CEO Jack Mallers, which hasn’t disclosed a purchase of the asset in over nine months.
“SoftBank’s involvement gave XXI the kind of institutional depth that few early-stage companies ever have,” Tether CEO Paolo Ardoino said in a statement. “Their experience backing some of the most consequential technology companies in the world brought credibility.”
XXI, which currently owns 43,514 Bitcoin, has increased its position a few times since it was created. As Bitcoin edged up to $77,470 on Wednesday, XXI’s stockpile was valued at nearly $3.4 billion, down from a peak of $5.4 billion in October, according to Bitcoin Treasuries.
Q&A
What does Tether's acquisition of SoftBank's stake in Twenty One Capital mean?
Tether's acquisition consolidates its control over Twenty One Capital, a Bitcoin-buying firm, and removes SoftBank as a stakeholder.
How much did SoftBank invest in Twenty One Capital and what is its current valuation?
SoftBank invested nearly $1 billion in Twenty One Capital, but its stake is now valued at approximately $711 million.
What are the implications of SoftBank's departure from Twenty One Capital?
SoftBank's departure has led to the resignation of its board designees, making Twenty One Capital temporarily non-compliant with NYSE rules.
