Jack Mallers leaves Twenty One as Strike tie-up ends and Bitcoin treasury pressure builds
Raphael Zagury inherits a large Bitcoin balance sheet and a mandate to prove it can support a durable business.
Quick Take
- Jack Mallers is stepping down as Twenty One CEO, and Raphael Zagury will replace him while Strike stays independent.
- Zagury inherits 43,514 BTC and about $114.1 million cash, with a mandate to build durable operating revenue.
- The challenge is proving Twenty One can fund itself through Bitcoin volatility without the Strike tie-up or easy financing.
Jack Mallers is stepping down as chief executive of Twenty One Capital to focus on Strike, while Twenty One and the Bitcoin payments company abandon a contemplated combination.
Raphael Zagury, a Twenty One board member with experience in capital markets and Bitcoin infrastructure, will take over as CEO. The change puts him in charge of building cash-generating operations around one of the largest corporate Bitcoin treasuries as weaker prices and tighter financing test the wider sector.
Mallers said he had decided to step down after the role clarified what he wanted to build. “My life's work remains Bitcoin. My Bitcoin company is Strike. The work continues,” he wrote.
Tether, Twenty One’s controlling shareholder, confirmed that Zagury would succeed Mallers and that the companies were working toward an orderly handover.
The Strike combination is no longer on the table
The split closes off a strategy Twenty One outlined less than three months ago.
On April 29, the company announced an operating plan centered on possible acquisitions of Strike and Elektron, a Bitcoin mining and energy infrastructure business associated with Zagury.
The plan was never a completed deal. Twenty One’s March-quarter filing, filed in May, said there were no binding commitments or agreements for either acquisition and that its board had not approved a transaction.
Tether’s announcement says Twenty One and Strike are no longer contemplating a combination because Strike is best positioned as an independent business. That makes the transition more consequential than a simple change at the top. Mallers is returning his attention to Strike, while Twenty One must develop its operating model without the payments company that had been central to its expansion proposal.
Twenty One is still one of the largest corporate Bitcoin holders. Its historical March 31 balance-sheet snapshot quantifies the exposure Zagury inherits.
As of March 31, the company reported 43,514 BTC with a fair value of about $2.95 billion, along with approximately $114.1 million in cash. Those figures are a dated quarterly snapshot, not a current July balance.
The same filing recorded a rounded $847.8 million fair-value loss on the Bitcoin position during the quarter. It also said approximately 16,116 BTC were pledged as collateral to convertible notes. The loss did not, by itself, represent an equivalent cash outflow, but it showed how directly Twenty One’s reported results move with Bitcoin.
The data show the scale of the treasury model Zagury is being asked to develop. Twenty One has said it wants to increase Bitcoin per share while building financial services, lending, capital markets products and other cash-generating operations around its holdings.
In Tether’s announcement, Zagury said Twenty One should be measured by the cash flow it produces and the discipline with which it allocates capital. Tether CEO Paolo Ardoino also emphasized Zagury’s experience building businesses with cash flow and disciplined execution.
The mandate shifts the performance test beyond the size of the Bitcoin stack.
Treasury financing raises the stakes
That emphasis arrives during a difficult market for companies financing large Bitcoin holdings.
Businesses that presented Bitcoin as a permanent reserve have had to weigh debt payments, collateral requirements, dividends and buybacks against continued accumulation. As CryptoSlate reported in May, those obligations can turn Bitcoin from a passive reserve into a source of corporate liquidity when financing conditions tighten.
Pressure has also reached the securities treasury companies use to raise money. Major treasury-linked preferred shares traded below their stated value during a June selloff, even as dividends continued and the market remained operational.
This month, new corporate Bitcoin credit initiatives were still moving forward, leaving investors to assess whether the financing structures can endure prolonged volatility.
Those conditions are not Twenty One’s stated reason for the leadership change. Mallers described his departure as a decision to focus on Strike, and Tether framed the handover as the end of the company’s founding chapter.
They do, however, make Zagury’s cash-flow and capital-allocation mandate more immediate. A treasury can grow when capital is readily available, and Bitcoin is rising. Building a durable listed company through a downturn requires operating cash flow and financing structures that do not rely entirely on a higher Bitcoin price.
With Strike remaining independent, Twenty One now has to prove that its Bitcoin balance sheet can support that broader business on its own.
