Tether signaled on Wednesday that it is consolidating control over Twenty One Capital (XXI), a Bitcoin-buying firm co-founded by the stablecoin giant last year, by acquiring shares held by Japanese investment firm SoftBank—one of XXI’s biggest initial backers.
XXI’s stock price is up nearly 5% on the day, yielding a market cap of $5.2 billion, yet shares remained down 83% compared to a year ago. Amid a burst of Bitcoin-buying firms on Wall Street last year, XXI’s stock price soared as high as $53, a peak notched before the company merged with a blank check firm created by Cantor Fitzgerald.
Bolstering its majority ownership of XXI, Tether said in a blog post that the move underscores its conviction in the Bitcoin-buying firm co-founded alongside Strike CEO Jack Mallers, which hasn’t disclosed a purchase of the asset in over nine months.
“SoftBank’s involvement gave XXI the kind of institutional depth that few early-stage companies ever have,” Tether CEO Paolo Ardoino said in a statement. “Their experience backing some of the most consequential technology companies in the world brought credibility.”
In Wednesday’s filing, XXI, which trades on the NYSE, said that SoftBank requested the resignation of partners that served on the company’s board of directors and applicable committees. One of the partners served on XXI’s audit committee, leaving the subgroup with an insufficient number of independent members under exchange rules.
In December, Tether and SoftBank owned 45.1% and 25% of XXI’s Class A stock, respectively. At the same time, Tether held 51.3% of XXI’s Class B stock, which carries outsized voting power, while SoftBank controlled 29.2% of that share class.
In XXI’s latest filing, the firm said that SoftBank’s Class B shares had been canceled. Additionally, the firm said that it plans to appoint an additional member to the audit committee who meets the necessary requirements “as soon as practicable.”
Decrypt has reached out to SoftBank for comment.
