Tether Buys Out SoftBank’s Stake in Joint Crypto Investment Firm

Tether has purchased SoftBank’s stake in their shared venture, crypto investment company Twenty One Capital.

“This transaction reflects the continued development of XXI as the company builds on its foundation and advances its long-term bitcoin strategy,” the stablecoin issuer said in a Wednesday (May 20) news release. “Tether’s increased commitment reflects its conviction that XXI represents one of the most important opportunities to build a public company around bitcoin from the ground up.”

Tether and Japanese tech investor SoftBank launched Twenty One Capital (or XXI, as Tether calls it) last year, contributing enough bitcoin—42,000, valued at $3.6 billion at the time—to make it the one of the largest corporate holders of the digital currency.

“SoftBank’s involvement gave XXI the kind of institutional depth that few early-stage companies ever have,” said Paolo Ardoino, Tether’s CEO. “Their experience backing some of the most consequential technology companies in the world brought credibility, perspective, and discipline to XXI during a critical period of formation. They leave behind a company with a stronger foundation, a clearer mandate and an ambitious path ahead.”

A report on the deal by Bloomberg News included the news outlet’s calculations that SoftBank had owned roughly 26% of Twenty One’s publicly-listed shares, worth around $679 million.

The report also noted that Twenty One’s core business of investing in bitcoin has fallen out of favor since the company’s launch. The declining price of the world’s most popular crypto has diminished the model’s appeal, with shares in Twenty One down more than 80% since a record high last year.

Many digital-asset treasury companies have either shut down or simply moved away from the model, the report added.

Meanwhile, recent research by PYMNTS Intelligence has found that, among middle market companies, crypto is used chiefly for payments rather than treasury.

Research from the report “Waiting for Certainty: Why Most CFOs Are Holding Back on Crypto and Stablecoins” found a “gap between awareness and use,” with only 13% of middle market businesses using stablecoins, and just 5% use cryptocurrencies.

“Even among those that have adopted digital assets, usage remains tightly bounded. Stablecoins are most often used for specific payment functions, such as paying domestic suppliers or receiving cross-border funds,” PYMNTS wrote earlier this year. “Cryptocurrencies are even less embedded, with usage largely confined to isolated transactions rather than recurring workflows.”