April 29, 2026 — Tether Investments, the investment arm of stablecoin issuer Tether, officially announced a proposal to facilitate two merger transactions involving Twenty-One Capital (XXI), Bitcoin financial services platform Strike, and Bitcoin mining company Elektron Energy. If the deals proceed as planned, XXI will transition from a "treasury-style" public company focused on holding Bitcoin as its core asset to a comprehensive platform integrating mining capacity, financial infrastructure, and institutional capital channels. Following the announcement, XXI shares rose about 8% in after-hours trading. As of April 30, 2026, Bitcoin traded in the $75,000–$76,000 range on the Gate market.
How the Three-Way Merger Proposal Is Structured
Tether Investments’ proposal follows a two-stage merger path. In the first stage, XXI merges with Bitcoin financial services provider Strike, bringing Strike’s global distribution network spanning over 100 countries, compliance infrastructure, and Bitcoin lending products into the XXI ecosystem. In the second stage, the merged entity combines with Elektron Energy, integrating Elektron’s large-scale mining operations into the same listed company. Tether has stated it will vote in favor of these deals, but the specific transaction terms, timeline, and governance arrangements have not yet been disclosed and will be revealed in subsequent discussions.
This stepwise "financial services first, mining capacity second" approach demonstrates a clear integration logic: Strike delivers user access and revenue streams, Elektron provides foundational computing power and asset production, while XXI offers the public company platform and capital leverage. The synergy is not simply an asset stack, but a complete business loop from "holding" to "producing" to "distributing."
Business Capabilities and Strategic Positioning of Each Party
XXI: Treasury Scale Drives Public Company Value
According to Bitcoin Treasuries data, XXI holds over 43,500 Bitcoins on its balance sheet, valued at roughly $3.26 billion at a price of $75,000 per BTC, making it the world’s second-largest listed Bitcoin treasury company after MicroStrategy. XXI went public on the NYSE via a SPAC merger in December 2025, with shareholders including Tether, Bitfinex, and Strike founder and current CEO Jack Mallers. However, since the start of 2026, XXI’s share price has fallen over 10%, reflecting ongoing market skepticism about the valuation model of "pure treasury" Bitcoin companies.
Strike: The Global Bitcoin Financial Interface
Founded by Jack Mallers, Strike offers Bitcoin purchase, custody, trading, and collateralized lending services in more than 100 countries. At the time of the merger proposal, Strike simultaneously launched "Volatility Proof Loans," allowing borrowers to pay extra fees to avoid forced liquidation due to sharp price swings. The product offers a credit line of up to $2.1 billion, with a minimum interest rate reduced to 7.49%, and has signed a credit agreement with Tether.
Elektron: Core Mining Infrastructure and Computing Power
Led by Raphael Zagury, Elektron Energy manages about 50 EH/s of Bitcoin hash rate, accounting for roughly 5% of the global total, and has mined over 5,500 Bitcoins to date. The all-in production cost per Bitcoin is below $60,000, meaning Elektron’s mining operations remain profitable with Bitcoin in the $75,000 range. Tether plans to nominate Zagury as president of the merged entity, leveraging his management experience in mining operations and capital markets.
Tether’s Strategic Logic Behind the Merger
Tether’s move is not an isolated case, but part of a strategic expansion from its stablecoin core into the Bitcoin computing power value chain. Tether Investments holds stakes in over 120 companies spanning AI, energy, fintech, and biotech. In Bitcoin mining, Tether has invested more than $20 billion in computing power and energy infrastructure, holds over 100,000 Bitcoins, and, through partnerships with Canaan and ACME Swisstech, develops modular mining hardware to drive deep integration of mining software and hardware.
Strategically, Tether aims to transform XXI from a "passive Bitcoin holder" into an "active asset accumulator." Traditional treasury-style companies rely on Bitcoin price appreciation for book gains, while integrating mining capacity allows the merged entity to continuously produce Bitcoin at below-market cost. Adding financial services brings recurring revenue from staking and lending. Mining cash flow and financial services income provide short-term financial support, while the treasury’s 43,500 Bitcoins anchor long-term value. Fundamentally, Tether seeks to build a vertically integrated Bitcoin value cycle that operates independently of external market volatility.
What Valuation Signals Are Revealed by Capital Market Reactions
Market response to the merger proposal sends a signal that warrants careful interpretation. XXI shares rose about 8% after the announcement, indicating recognition of the strategic direction. However, this rebound comes after a cumulative decline of over 10% in 2026, with no reports of significant trading volume. Some analysts note that XXI’s share price has dropped nearly 50% in the past 120 days, suggesting structural doubts about the value of pure Bitcoin treasury holdings.
Thus, the current uptick reflects pricing for "directional adjustment" rather than a completed "value re-rating." The capital market’s focus is whether the combination of mining and financial services can improve XXI’s profitability and cash flow, and whether it can provide new valuation metrics from an EBITDA perspective. The merged entity’s ability to transition from a treasury-style company to an operating platform will directly determine whether its valuation logic can be successfully reconstructed.
How Will the Competitive Landscape in Bitcoin Mining Evolve
Since 2026, the trend toward consolidation in Bitcoin mining has accelerated. In March 2026, Sphere 3D and Cathedra Bitcoin agreed to an all-stock merger; Olenox and Brazil’s CS Digital announced a merger to develop low-cost off-grid mining and AI data center infrastructure; American Bitcoin, in April, expanded its mining fleet to 89,242 machines, boosting hash rate to 28.1 EH/s.
Among these cases, Tether’s three-way merger stands out for its differentiated approach: it is not simply a horizontal merger among mining companies to scale up hash rate, but a vertical integration of treasury reserves, financial services, and mining capacity within a single listed platform—bridging different segments of the value chain. If proven effective, this model could reshape the valuation and competitive dynamics of public Bitcoin companies.
Key Risks to Monitor
First, execution risk. Transaction terms, final timeline, and governance arrangements remain undisclosed. Integrating fintech and mining assets into a large public company involves complex legal and operational challenges, and whether three businesses at different development stages can merge smoothly is uncertain.
Second, regulatory risk. The merged entity will span Bitcoin mining, financial services, and public capital markets, potentially facing stricter scrutiny across multiple jurisdictions, especially regarding asset transparency in collateralized lending and energy consumption in mining.
Third, Bitcoin price trends and structural industry risks. If Bitcoin’s price remains in the current range or declines further, even a theoretically stronger financial structure may not shield mining profitability from direct challenges. The industry itself is undergoing structural differentiation: some miners are pivoting to AI data centers for diversified revenue, while Tether continues to double down on computing power. These divergent paths create varying competitive pressures, and the merged entity must continually prove the resilience of its business model within its chosen strategy.
Summary
The three-way merger driven by Tether Investments—XXI, Strike, and Elektron Energy—marks a significant shift for public Bitcoin companies from simple asset holding to vertically integrated platforms. By combining 43,514 Bitcoins in reserve, globally accessible Bitcoin financial services, and 50 EH/s of mining capacity within a single listed entity, the merger, if completed, will create a Bitcoin platform with production, distribution, and capital management capabilities. The 8% after-hours rise in XXI’s share price reflects initial market approval, but the real test lies in execution, regulatory adaptability, and the evolution of Bitcoin’s market cycle. This proposal also offers Gate platform users a crucial window into how industry capital dynamics are changing.
FAQ
Q1: What is the current status of the three-way merger proposal?
A1: Tether Investments put forward a two-step merger plan on April 29, 2026 and has stated it will vote in favor. Specific terms, timeline, and governance details have not yet been disclosed and will be announced in future discussions.
Q2: How will the merger change XXI’s business structure?
A2: If completed, XXI will shift from a treasury-style company relying mainly on Bitcoin holdings to an integrated operating platform combining mining output, financial business income, and treasury reserves. Its business will span asset reserves, mining, fintech, and capital markets.
Q3: What roles do Strike and Elektron play in the merger?
A3: Strike provides Bitcoin buy, sell, custody, and lending financial services across more than 100 countries. Elektron contributes approximately 50 EH/s of Bitcoin hash rate and sub-$60,000 mining costs per coin. Together, they represent the "revenue side" and "production side" of the merged platform.
Q4: How will management be structured after the merger?
A4: Tether Investments plans to nominate Elektron founder Raphael Zagury as president of the merged entity, overseeing capital markets and operations. Strike founder Jack Mallers will continue to focus on product, brand, and consumer Bitcoin business.
Q5: What are the main concerns about the merger?
A5: The core concerns center on whether integration can be executed smoothly and regulatory compliance risks. Additionally, the profitability of mining means the merged entity’s valuation will depend on BTC price, and the industry is currently experiencing structural differentiation as some miners pivot to AI and other sectors.
