Shares in Twenty One Capital (XXI), the latest crypto treasury firm in the US, fell by 20% on its trading debut following its merger with the blank-check company Cantor Equity Partners.
Twenty One Capital began trading on Tuesday at $10.74, which was below Cantor’s closing price of $14.27 on Monday for its special purpose acquisition company.
The Bitcoin (BTC)-focused firm’s stock closed on Wednesday at $11.42, representing a 19.97% decrease over the previous 24 hours.
Nonetheless, it experienced a modest 2.2% after-hours increase to $11.67, resulting in a market capitalization of approximately $4 billion based on its outstanding shares.
Twenty One was one of the most anticipated crypto public debuts of the year, with backing from significant stablecoin issuer Tether and crypto exchange Bitfinex, as well as Japan’s SoftBank Group. Jack Mallers, founder and CEO of the Bitcoin platform Strike, has also taken the reins as CEO of Twenty One.
The company possesses over 43,500 Bitcoin valued at more than $4 billion, ranking it as the third-largest holder among public companies, following Bitcoin miner MARA Holdings, according to BitcoinTreasuries.NET.
Twenty One has no public plan, yet it’s “not a treasury”
Twenty One has not revealed its operational plans or a launch timeline, but Mallers shared with CNBC that it’s “not a treasury company.”
“We don’t want the market to view us merely as a treasury asset,” he stated. “We hold a significant amount of Bitcoin, but we’re also developing a business.”
“We’re establishing an operational company and launching numerous Bitcoin products aimed at generating cash flow,” Mallers explained, noting opportunities in brokerage, exchange, credit, and lending.
When pressed for specifics on Twenty One’s plans, Mallers suggested, “We’ll reveal these details sooner rather than later.”
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The US has witnessed a surge of crypto treasury companies entering the market this year, emulating a model popularized by Strategy, which involves purchasing and holding crypto while raising capital for further acquisitions.
These crypto holding firms attracted investor interest earlier this year as Bitcoin soared to new heights in October; however, a downturn in the crypto market has subsequently affected shares in companies linked to the sector.
Mallers appears optimistic that his association with Tether and strong belief in Bitcoin will help sustain Twenty One in this interim period.
“We view Bitcoin as the focal point beyond the immediate circumstances,” he told CNBC. “It represents the opportunity, while others seem distracted. The essence of this equity is to concentrate solely on Bitcoin and provide value to shareholders predominantly through Bitcoin.”
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