Shares in Twenty One Capital (XXI), the newest crypto treasury firm in the US, fell 20% during its trading debut after merging with the blank-check corporation Cantor Equity Partners.
The company commenced trading on Tuesday at $10.74, below Cantor’s special purpose acquisition company’s closing price of $14.27 on Monday.
By Wednesday, the Bitcoin (BTC)-focused company’s stock closed at $11.42, reflecting a 19.97% decline within 24 hours.
However, it later experienced a slight after-hours increase of 2.2%, reaching $11.67, leading to a market capitalization of approximately $4 billion based on outstanding shares.
Twenty One was among the most eagerly anticipated crypto public debuts this year, supported by significant backers including stablecoin issuer Tether, crypto exchange Bitfinex Japan’s SoftBank Group, and Jack Mallers, founder and CEO of the Bitcoin platform Strike, who was also appointed CEO of Twenty One.
The firm holds over 43,500 Bitcoin valued at more than $4 billion, ranking it third among public companies in terms of Bitcoin holdings, following Bitcoin miner MARA Holdings, according to BitcoinTreasuries.NET.
Twenty One has no public plan, but it’s “not a treasury”
The company has not disclosed its specific business operations or launch timeline, but Mallers told CNBC it is “not a treasury company.”
“We don’t want the market to perceive or price us merely as a treasury asset,” he added. “While we do possess a large amount of Bitcoin, we are also constructing a business.”
“We are developing an operating company and introducing numerous Bitcoin products to market with the aim of generating cash flow,” Mallers stated, noting potential in brokerage, exchange, credit, and lending.
Mallers was evasive when questioned about the exact plans for Twenty One, indicating, “We’ll reveal these details sooner rather than later.”
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The US has seen a surge of so-called crypto treasury companies this year, adopting a model made popular by Strategy, which involves buying and holding crypto while raising capital for continued purchases.
Such crypto holding companies attracted investor interest earlier this year as Bitcoin surged to highs in October, but a recent downturn in the crypto market has negatively impacted shares of companies involved in the sector.
Mallers seems to be banking on his and Tether’s history, along with his confidence in Bitcoin, to sustain Twenty One during this period.
“We view Bitcoin as the forest through the trees,” he told CNBC. “It represents the opportunity that few seem to be focusing on. The narrative of this equity centers on an exclusive focus on Bitcoin and delivering shareholder value primarily through it.”
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