Twenty One Capital's First-Day Decline Reflects Investor Skepticism Toward BTC-Backed Stocks

Twenty One Capital’s debut on the NYSE experienced a nearly 20% decline, indicating investor wariness towards Bitcoin-focused public companies.
The stock, trading as XXI, remained close to its net asset value (NAV), suggesting minimal premium was placed on its Bitcoin holdings.
This price drop was influenced by broader market conditions, including Bitcoin's volatility, declining interest in SPAC-backed companies, and diminishing mNAV premiums.
The subdued market response hints that investors are now looking for Bitcoin-related firms to demonstrate solid, sustainable revenue models instead of just relying on significant Bitcoin reserves.

Key Takeaways

Twenty One Capital’s debut on the NYSE experienced a nearly 20% decline, indicating investor wariness towards Bitcoin-focused public companies.
The stock, trading as XXI, remained close to its net asset value (NAV), suggesting minimal premium was placed on its Bitcoin holdings.
This price drop was influenced by broader market conditions, including Bitcoin's volatility, declining interest in SPAC-backed companies, and diminishing mNAV premiums.
The subdued market response hints that investors are now looking for Bitcoin-related firms to demonstrate solid, sustainable revenue models instead of just relying on significant Bitcoin reserves.

Twenty One Capital’s initial trading on the New York Stock Exchange (NYSE) saw shares plummet by almost 20%, signaling a notable level of caution among investors regarding companies heavily invested in Bitcoin. The company's stock, tickered as XXI, reflected this wariness as it closed significantly below its anticipated value.

This article delves into what the market's reaction could indicate about evolving investor preferences, the decline in multiple-to-net-asset-value (mNAV) premiums, and the increased scrutiny on Bitcoin-backed equity listings.

Twenty One’s first-day slide highlights investor caution toward BTC-backed stocks

Overview of Twenty One Capital

Twenty One Capital is a public company centered on Bitcoin, backed by institutional investors. The firm aims to become the largest publicly traded holder of Bitcoin. It entered the public market through a special-purpose acquisition company (SPAC) partnership with Cantor Equity Partners, subsequently adopting the ticker XXI.

Upon its launch, Twenty One Capital disclosed a treasury composed of over 43,500 BTC, valued between $3.9 billion and $4.0 billion, positioning it among the largest Bitcoin holders in the corporate world. The company's aim is not solely to serve as a treasury vehicle; its founders, including Jack Mallers of Strike fame, have expressed intentions to build corporate infrastructure aimed at Bitcoin-related financial products.

Distinctively, Twenty One Capital associates with notable investors such as Cantor Fitzgerald, the issuer of Tether (USDt), and SoftBank. These affiliations showcase Twenty One as one of the most robustly supported Bitcoin-native firms to enter the public listing sphere.

Though the company launched amid a wider trend of publicly traded entities embracing Bitcoin strategies, its founders intend to focus on revenue growth while maintaining a significant Bitcoin reserve instead of merely emulating existing successful models.

Twenty One Capital debut drop

Initial Trading Performance and Price Decline

Despite the expectation of significant market interest given the size of its treasury and reputable backers, Twenty One Capital faced disappointing trading results on its debut day, December 9, 2025. Instead of the anticipated positive response, stock prices fell sharply.

The shares started trading at $10.74, which was lower than the previous closing of Cantor Equity Partners' SPAC at $14.27. A modest rebound occurred during after-hours trading; however, by the end of the first day, shares were down nearly 20%, finishing at $11.96. This performance underscored a trend where newly listed crypto-centric firms tend to underperform compared to pre-merger benchmarks. The pricing also indicated that the market was valuing the newly public stock at a discount compared to its Bitcoin holdings.

Market performance of Twenty One Capital

Market Caution and the Decline in Stock Price

The significant drop in Twenty One Capital's stock is reflective of broader market trends rather than an isolated incident. It encapsulated factors such as:

The erosion of the multiple-to-net-asset-value (mNAV) premium
Ongoing volatility within the cryptocurrency markets
A downturn in enthusiasm for SPAC-driven public listings

The most evident sign of caution among investors was the lack of a significant premium above the company's Bitcoin holdings. This premium is customarily assessed using the mNAV ratio, which, in the past, has indicated investor confidence in management's ability to bolster value beyond available assets. However, Twenty One Capital traded at or near its asset value, suggesting limited confidence was placed in its management or operational plans.

The timing of the launch coincided with increasing pressures within the crypto market, particularly as Bitcoin had recently fallen over 28% from its peak in October, fostering a climate where investors were hesitant to assign elevated valuations to crypto-focused equities. Moreover, while SPAC partnerships had previously driven interest, by late 2025, enthusiasm had waned due to a history of poor post-merger performance, leading to investor fatigue and skepticism.

Did you know? The situation where a stock trades below the market value of its Bitcoin assets is a valuation paradox, highlighting the complicated dynamics in assessing newly public companies.

Shift in Market Demand: Focus on Reliable Business Models

One significant factor contributing to investor hesitancy was the missing clear, revenue-generating operating model at the time of Twenty One Capital's debut. This indicates a potential shift away from merely "Bitcoin treasury" narratives, with greater emphasis on businesses that can generate predictable cash flows and differentiate themselves in the market.

While Twenty One Capital entered the public space with substantial Bitcoin assets, it lacked a comprehensive business strategy or timeline made known to the public. This debut occurred during a time when digital asset treasury companies, or DATs, faced increased scrutiny.

Analysts noted that gaining capital for DATs is becoming increasingly challenging. Companies now need to demonstrate significant differentiation to justify their valuation multiples. The pronounced drop in XXI’s stock price could signify a changing perspective in the market, as investors may be increasingly prioritizing firms that can effectively implement sustainable business models alongside their asset holdings.