Key Highlights
- Tether unveiled a proposal to combine Twenty One Capital (XXI), Strike, and Elektron Energy
- Shares climbed more than 6% during extended trading hours
- The proposed entity would integrate Bitcoin mining operations, treasury management, and payment services
- Jack Mallers set to assume executive leadership; Raphael Zagury positioned as president
- Financial details and completion timeline remain undisclosed
Shares of Twenty One Capital (XXI) advanced over 6% during after-hours trading Wednesday following Tether Investments’ announcement of a proposed three-way combination with Bitcoin payments company Strike and mining operator Elektron Energy.
The stock concluded standard trading hours at $7.83, reflecting a 1.7% decline, before rallying to an after-hours peak of $9.28 and later stabilizing at $8.35.
Tether confirmed its intention to support both transactions with its XXI shareholding. The arrangement consists of two components: initially merging XXI with Strike, followed by incorporating Elektron Energy to establish a comprehensive Bitcoin-centric publicly traded enterprise.
XXI has faced headwinds throughout the current year. Year-to-date performance shows a decline exceeding 10.5%, mirroring the broader downturn in Bitcoin prices.
The firm presently maintains holdings of 43,514 BTC, positioning it as the second-largest corporate Bitcoin holder. Strategy, Inc. leads the category with 818,334 BTC in its treasury.
Strategic Contributions From Each Entity
Strike brings to the table what Tether characterized as a cash-flow-positive financial services infrastructure, complemented by worldwide reach and established regulatory frameworks.
Elektron Energy contributes substantial Bitcoin mining capacity. The operation controls approximately 5% of the Bitcoin network’s aggregate computational resources, maintaining production costs under $60,000 per Bitcoin across all expenses.
The combination would consolidate Bitcoin treasury holdings, mining infrastructure, payment processing, lending services, and capital markets capabilities within a single publicly traded organization.
“These combined transactions would transform XXI from a treasury-focused vehicle into a diversified platform featuring active business operations, dependable revenue streams, and sustainable Bitcoin acquisition mechanisms,” Tether stated in its announcement.
Proposed Executive Team
Tether’s proposal designates Raphael Zagury, founder and CEO of Elektron, as president of the unified organization.
Jack Mallers, serving as founder and CEO of Strike while simultaneously holding the co-founder and CEO positions at XXI, would continue in an executive capacity within the consolidated company.
Tether characterized this arrangement as merging “Mallers’ expertise in product development, brand building, and consumer Bitcoin services with Zagury’s proficiency in capital markets operations and strategic execution.”
Additional leadership appointments were not specified.
XXI completed its public listing in December via a SPAC transaction with Cantor Equity Partners. The company launched with backing from Tether, Bitfinex, and Mallers, establishing its mission around cost-effective Bitcoin acquisition strategies.
Should both merger proposals proceed to completion, the company’s original focus would evolve significantly beyond maintaining Bitcoin reserves.
Tether has yet to reveal transaction valuations or projected closing dates for either deal.
