Cantor joins hand with SoftBank, Tether for $3.6 billion crypto venture

(Reuters) - Cantor Fitzgerald is launching a crypto venture with Tether and Japanese technology investor SoftBank Group to buy bitcoin

Cantor Fitzgerald is launching a crypto venture with Tether and Japanese technology investor SoftBank Group to buy bitcoin, deepening ties between the firms and marking a key step in rising institutional adoption of crypto.

The move, announced on Wednesday, also sees Cantor Equity Partners - the blank-check vehicle formed earlier this year by the brokerage - launch the venture, called Twenty-One Capital, with $3.6 billion.

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The venture will offer investors an investment vehicle for exposure to the world’s largest crypto treasury and a new take on a bitcoin-focused investment fund.

The venture may also seek to replicate the success of bitcoin acquirer MicroStrategy, which saw its market value soar late last year as crypto prices jumped following U.S. President Donald Trump’s election victory. Trump has promised to support the crypto industry by easing regulations for digital assets.

“We're not here to beat the market, we're here to build a new one. A public stock, built by Bitcoiners, for Bitcoiners,” said Twenty One Co-Founder and CEO Jack Mallers.

Saylor’s firm is the biggest corporate holder of bitcoin and held 538,200 units of the digital asset as of April 20.

TETHER-CANTOR TIES

Twenty One will be majority owned by Tether and cryptocurrency exchange Bitfinex. SoftBank will have a minority ownership.

Tether and Cantor have long-standing ties from when Howard Lutnick was the brokerage’s boss. Cantor is said to hold much of the dollar-denominated reserves Tether says it has for every token it creates for its stablecoin.

Of the U.S. Treasury bills Tether holds, 99% are held with Cantor, Tether CEO Paolo Ardoino told Reuters in an interview last month.

“Bitcoin is one of the only truly decentralized, immutable, and censorship-resistant assets, and its role as the foundation of a new financial system is inevitable,” Ardoino said.

The companies will raise an additional $585 million in capital from investors through a combination of convertible bonds and equity financing.

Twenty One will seek to trade on the Nasdaq under the symbol “XXI” after the deal closes.