Why Twenty One’s Initial Drop Reflects Decreased Interest in Bitcoin Companies

Key takeaways

• The NYSE debut of Twenty One Capital experienced a significant drop of nearly 20%, indicating a cautious atmosphere among investors regarding Bitcoin-centric public offerings.

• XXI traded near its net asset value, implying that the market did not attribute a significant premium beyond the firm’s Bitcoin assets.

• This decline reflected wider market pressures, including Bitcoin’s volatility, waning interest in SPAC-driven listings, and weaker mNAV premiums.

• The subdued reaction indicates that investors may now be looking for Bitcoin-focused companies to exhibit clear, sustainable revenue models rather than depending largely on substantial BTC holdings.

The public launch of Twenty One Capital, a well-regarded Bitcoin-centric firm, on the NYSE was met with hesitant investor sentiment. Trading under ticker XXI, the company’s stock plummeted nearly 20% on its inaugural day.

This article examines what the market’s reaction may indicate about shifting investor preferences, the diminishing mNAV premium, and the overall scrutiny faced by Bitcoin-backed equity listings.

What Twenty One Capital actually is

Twenty One Capital is an institutionally supported, Bitcoin-focused public company with the aim of becoming the largest public holder of Bitcoin (BTC). The firm entered the market through a SPAC merger with Cantor Equity Partners and trades under ticker XXI.

At launch, it reported a treasury of over 43,500 BTC, valued at approximately $3.9 billion-$4.0 billion, making it one of the biggest corporate Bitcoin holders.

With a clear goal in mind, the firm has a corporate setup centered around Bitcoin. Its founders view it as more than just a treasury vehicle. Jack Mallers, also the founder of Strike, stated that Twenty One aims to create corporate infrastructure for Bitcoin-aligned financial products.

This business model aligns Twenty One with other digital asset treasury (DAT) companies, albeit with important distinctions. It counts among its backers Cantor Fitzgerald, a primary dealer for the Federal Reserve; Tether, the USDT issuer and a significant holder of US Treasuries; Bitfinex; and SoftBank. These institutional affiliations position Twenty One as one of the most robustly supported Bitcoin-native firms to become publicly listed.

The company emerged amid a broader trend of publicly traded firms adopting Bitcoin-centric strategies, partly influenced by the model utilized by Strategy (previously MicroStrategy). However, Twenty One’s declared intention is not merely to replicate that strategy but to aim for revenue-driven growth while holding substantial Bitcoin reserves.

The debut and the sharp price drop

Given the size of its treasury and the reputation of its backers, many in the market expected significant interest in Twenty One’s launch. However, on its first trading day, Dec. 9, 2025, a different scenario unfolded. The stock sharply declined despite the firm’s sizeable Bitcoin assets and prominent institutional backing.

When the SPAC shares from Cantor Equity Partners converted into XXI, the stock opened at $10.74, below the SPAC’s previous close of $14.27. After-hours trading showed a slight recovery. By the end of its inaugural trading day, the shares were down about 19.97%, closing at $11.96.

This performance highlighted a broader tendency where newly listed cryptocurrency-related firms frequently trade below their pre-merger values. The move also left the newly public equity valued at a discount compared to its underlying cryptocurrency assets, suggesting a shift in the valuation dynamics for this type of stock.

Investor caution and Twenty One’s NYSE slide

The significant drop in Twenty One Capital’s stock price was not an isolated incident. It mirrored a combination of three market factors in late 2025:

• Diminished multiple-to-net-asset-value (mNAV) premium

• Ongoing volatility in cryptocurrency markets

• Declining sentiment toward SPAC-driven public launches.

Understanding the muted mNAV valuation

A clear indication of market caution was that the stock did not trade at a substantial premium to its Bitcoin holdings, typically assessed via the mNAV ratio.

Historically, firms with Bitcoin treasuries have enjoyed a significant mNAV premium at various points in market cycles, often interpreted as a sign of investor confidence in management’s capacity to create value beyond their assets.

In contrast, Twenty One Capital traded at or near its asset value, implying little to no premium for its business strategies or management. This suggests the market valued the stock primarily as a direct and potentially unpredictable proxy for Bitcoin, rather than factoring in a dedicated operational premium.

Market volatility and SPAC sentiment

Twenty One Capital launched during a difficult phase for both the crypto market and SPAC-driven listings. Prior to the debut, cryptocurrencies faced downward pressure. Bitcoin had dropped more than 28% from its peak in October, creating a risk-averse environment where investors were hesitant to assign generous valuations to crypto-linked stocks.

The merger with Cantor Equity Partners represented a SPAC route to going public. Although initial enthusiasm for the deal briefly soared SPAC shares, by late 2025, excitement for notable crypto SPACs had diminished. A history of underperformance post-merger has fueled investor fatigue and skepticism, causing newly public companies to trade below their pre-merger values.

Did you know? The stock trading below the value of its Bitcoin reserves exemplifies a valuation paradox, where a newly public company is priced lower than the market value of its primary liquid assets.

Market shift: Demand for proven business models

Another reason for the investor caution could be the absence of a clear, established revenue-generating model at the time of the debut. This indicates that some investors may be drifting away from mere “Bitcoin treasury” narratives and prioritizing differentiation and consistent cash flows.

While Twenty One Capital launched with substantial Bitcoin assets, it lacked a publicly disclosed business plan or confirmed timeline. The launch also coincided with increased scrutiny of the digital asset treasury sector.

According to Reuters, analysts indicate that it is becoming “more challenging for DATs to secure funding” and that firms “need to demonstrate tangible differentiation” to validate their trading multiples.

The dramatic decline in XXI’s share price may signify an evolving market perspective. Some investors might be redirecting their focus to a company’s ability to implement a lasting business model alongside its assets. Public markets may increasingly favor firms capable of generating steady cash flows over those primarily holding Bitcoin.