Twenty One Capital posted a $413.5 million net loss in the second quarter, mostly driven by the falling value of its massive Bitcoin holdings, as newly appointed CEO Raphael Zagury laid out plans to turn the Tether-backed firm into a bigger-picture Bitcoin operating company. The results mark a challenging start for the new leadership.
The NYSE-listed company recorded a $401.5 million loss from changes in the value of its digital asset holdings, accounting for more than 97% of its overall loss. Twenty One currently holds 43,514 Bitcoin worth roughly $2.78 billion at current prices, ranking as the second-largest publicly traded Bitcoin treasury. Japan-based Metaplanet is closing the gap with 43,000 BTC.
A New CEO With a New Vision
The results come roughly three weeks after Zagury replaced the company's founder as CEO, with the founder stepping down to return his focus to his Bitcoin payments company. The leadership shakeup also saw a proposed merger fall through, while a potential acquisition of a Bitcoin mining operation remained under consideration.
In his first shareholder letter since taking the reins, Zagury acknowledged concerns over Twenty One's performance and said the company needs to prove it can create value beyond just holding Bitcoin. He emphasized that while Twenty One owns one of the largest Bitcoin balance sheets in the public markets, that advantage alone is not enough to justify the company's existence.
Five Priorities for the Year Ahead
Zagury outlined five priorities: strengthening governance, building or acquiring operating businesses, developing capital-market capabilities, establishing an M&A operation, and eventually launching a Bitcoin lending and credit business. He pointed to Berkshire Hathaway as a blueprint for what he envisions: a strong balance sheet surrounded by independently operated businesses that generate cash flow.
The Berkshire comparison is ambitious. Twenty One's CEO acknowledged that the company has earned nothing yet, a frank admission that underscores the gap between aspiration and current reality. The challenge is turning a Bitcoin treasury vehicle into an operating company that generates revenue independent of Bitcoin's price.
The Valuation Gap
Zagury also addressed Twenty One's depressed valuation, saying investors had pointed out that its stock trades at a material discount to the Bitcoin it holds. That discount is reflected in the company's enterprise mNAV, a measure that compares its valuation with the value of its Bitcoin holdings, which currently stands at 0.7x.
A ratio below 1.0x means the market values the company at less than the worth of its Bitcoin, implying that either the market distrusts the company's ability to manage those assets or that the operational overhead is seen as a drag rather than a value-add. Zagury acknowledged that this gap could be viewed as a misallocation of capital.
The Broader Bitcoin Treasury Trend
Twenty One's challenges reflect a broader reckoning for publicly traded Bitcoin treasury companies. With Bitcoin trading well below the highs of late 2025, corporate treasuries that accumulated at higher prices face growing scrutiny over their strategies. Japan's Metaplanet moved 3,881 BTC between wallets on the same day Twenty One reported its loss, drawing attention to the pressure facing corporate Bitcoin holders.
The company also ended the quarter with $106.1 million in cash and roughly $484.5 million of convertible notes outstanding. Shares rose about 1% during the first hour of trading to $4.62, though the stock remains down nearly 50% year-to-date.
Can a Bitcoin Treasury Become More?
The fundamental question facing Twenty One Capital is whether a company whose primary asset is Bitcoin can build enough additional value to justify its existence as a corporate entity. The Berkshire Hathaway model works because Berkshire's operating businesses generate cash that can be reinvested. Twenty One has no such businesses yet.
Zagury's five-point plan is a roadmap for that transformation, but it is a plan, not a result. Whether the company can execute on its vision while managing a $2.78 billion Bitcoin position that continues to fluctuate in value will determine whether Twenty One becomes the next Berkshire of Bitcoin or simply another cautionary tale from the crypto treasury era.
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