Shares of Twenty One Capital, a firm focused on bitcoin, have risen by over 8% in after-hours trading on Wednesday. This increase comes after Tether Investments, the majority shareholder, proposed a merger with Strike and Elektron Energy.
Tether Investments, the investment arm of the stablecoin issuer, plans to vote in favor of combining Twenty One Capital with Strike, a global bitcoin financial services company founded by Jack Mallers, and Elektron Energy, as stated in a press release. Mallers also serves as the CEO of Twenty One Capital.
According to the press release, 'Upon completion, these transactions would position Twenty One Capital to become the world's premier listed Bitcoin company, integrating bitcoin treasury, mining, financial services, lending, capital markets, and strategic consolidation into one platform.' The terms and timelines of the merger have not been disclosed. Elektron Energy, led by Raphael Zagury, manages approximately 5% of the current bitcoin network's computing power, with production costs below $60,000 per bitcoin. Tether has also proposed that Zagury serve as President of the combined entity, leveraging his experience in mining and capital markets alongside Mallers' expertise in product and consumer bitcoin.
Twenty One Capital went public in December of last year through a SPAC merger with Cantor Equity Partners, entering the market as a bitcoin treasury firm with 43,514 BTC and backed by Tether, Bitfinex, and Strike CEO Jack Mallers. Initially, the company focused on 'capital-efficient bitcoin accumulation.' If the proposed merger takes place, the company will expand its commitment to bitcoin services beyond treasury exposure, according to the press release. 'The combined transactions would transition Twenty One Capital from solely treasury exposure to a platform with operating businesses, recurring revenue opportunities, and long-term Bitcoin accumulation capabilities,' the statement added.