The planned merger between three Tether-backed crypto companies has been shelved, with the businesses opting to move in different directions as one executive steps down and another takes on a larger leadership role.
According to a Bloomberg report from Tuesday, Twenty One Capital, Strike and Elektron Energy will no longer pursue the proposed combination that was first announced earlier this year.
The decision is also accompanied by a management shake-up, with Jack Mallers stepping down as CEO of Twenty One Capital and Elektron Energy CEO Raphael Zagury taking over the position.
Mallers, one of the best-known names in the Bitcoin industry, will remain CEO of Strike, the crypto payments and trading platform he founded. Strike will continue operating as a standalone company and is no longer expected to merge with Twenty One Capital.
Talks between Twenty One Capital and Elektron Energy, however, are still ongoing. Both companies are majority-owned by stablecoin issuer Tether.
Tether’s plan sought to unite three crypto businesses
The merger was originally proposed by Tether in April as a way to bring together three different parts of the crypto ecosystem under one roof. The idea was to combine Twenty One Capital’s digital asset treasury business, Strike’s bitcoin trading platform and Elektron Energy’s bitcoin mining operations into a single company.
Had it gone ahead, the deal would have created a business spanning several major areas of the crypto market, from holding bitcoin on its balance sheet to facilitating trading and mining new coins.
The companies have not explained why the broader merger was abandoned. The decision comes during a period of renewed pressure on parts of the cryptocurrency industry.
Companies built around digital asset treasuries have faced challenges as bitcoin prices have weakened in recent months. Because these businesses hold large amounts of bitcoin on their balance sheets, price declines can significantly affect their financial performance, forcing some firms across the industry to reduce costs and cut jobs.
That environment has made it more difficult for companies whose business models depend heavily on the value of digital assets.
At the same time, many crypto firms have been looking to diversify their operations by expanding into new products and services, rather than relying on a single source of revenue.
The proposed merger appeared to fit that strategy by combining treasury management, trading and mining into one organization. However, the companies have not disclosed what led them to abandon those plans.
Leadership changes also notable
Mallers has become one of the industry’s most recognizable executives through Strike, which focuses on bitcoin payments and trading. His departure from Twenty One Capital allows him to concentrate fully on Strike, while Zagury will now lead Twenty One Capital through its next phase.
Tether, meanwhile, continues to expand well beyond its role as the issuer of the USDT stablecoin. In recent years, the company has invested heavily across the digital asset industry, backing businesses involved in Bitcoin mining, artificial intelligence, fintech and blockchain infrastructure.
Although the three-company merger is no longer moving forward, discussions between Twenty One Capital and Elektron Energy suggest some form of collaboration could still emerge. For now, however, Strike will remain independent, while Tether-backed Twenty One Capital and Elektron Energy continue exploring their options.
