Twenty One Capital has abandoned plans to merge with financial services firm Bitcoin Strike, ending a key part of a proposed Tether-backed trilogy.
summary
- Strike will remain independent after Twenty One abandoned its plans to combine three major Bitcoin companies.
- Jack Mallers has stepped down as CEO of Twenty One to focus on Strike’s next phase of growth.
- Elektron founder Rafael Zagori now leads Twenty One as the two companies continue to evaluate a potential merger.
The company confirmed the change on July 21, along with a change in leadership. Jack Mallers has stepped down as CEO of Twenty One to focus on Strike, while Rafael Zagori, founder of Elektron Energy, has taken over as CEO effective July 20. Strike will continue to operate as an independent company.
The decision ends the original plan to combine Twenty One’s bitcoin treasury business with Strike’s financial services platform and Elektron’s mining infrastructure. However, Twenty One said the separate deal with Elektron is still under review and has not reached a final agreement.
Strike departs from the broader Bitcoin consolidation plan
Tether proposed the broader group in April. The plan called for Twenty One to merge with Strike before pursuing another deal with Elektron Energy. The proposed structure would have combined bitcoin treasury management, payments, lending and mining under one group of companies.
As crypto.news previously I mentionedThe proposal initially sent Twenty One stock soaring in after-hours trading. At the time, Tether said the expanded business could move Twenty One beyond owning Bitcoin and into operating a business capable of generating recurring revenue.
This strategy has now changed. Twenty One said Strike “plans to remain an independent company and is no longer under consideration for a business combination” with the company. Mallers will also return his full attention to the business he founded.
“Serving Bitcoin users has always been the mission, and that doesn’t change,” Mallers said. “The hit is where I move forward.” Twenty One did not provide a detailed reason for ending the proposed group with Strike.
Rafael Zaguri takes control of Twenty One
Zagury now takes charge while Twenty One shifts its strategy towards operating businesses, capital markets services, bitcoin-backed financial products and lending. He previously served as Director of Twenty One while leading the team behind Elektron Energy.
“My mission is to build an operating company around it,” Zagori said, referring to Twenty One’s large bitcoin balance sheet. He added that the company plans to focus more closely on cash flow and capital allocation alongside its Bitcoin holdings.
Twenty One and Electron can still be combined. The company said any potential acquisition is still at an initial stage and would require review under rules covering related party transactions. She also warned that there is no guarantee that the companies will reach or complete a final agreement.
The narrower talks come after Tether increased its control of Twenty One earlier this year. pregnancy acquired SoftBank fully acquired SoftBank’s stake in the bitcoin treasury company in May, ending one of Twenty One’s largest outside ownership positions.
Twenty One is recalibrating the strategy after the ownership change
The management transition follows other changes at Twenty One since SoftBank’s exit. like I mentioned previouslyThe company received a compliance notice from the New York Stock Exchange after leaving the board and leaving its audit committee below required levels of independence.
Twenty One now presents itself as a broader Bitcoin-focused operator rather than just a treasury tool for businesses. Its updated priorities include acquisitions, capital markets activities and a bitcoin-native lending business designed to allow holders to access liquidity without selling their assets.
Currently, the original merger plan of the three companies is no longer moving forward. Strike remains under Mallers as an independent company, Zagury has taken control of Twenty One, and talks regarding Elektron continue without a final agreement.
