Twenty One Capital Posts $1.09 Billion Profit on Bitcoin Gain
XXI ended September with 43,514 bitcoin valued near $83,700 each. At Friday's price of about $68,400, that stack is worth roughly $666 million less.
Twenty One Capital (XXI) reported net income of $1.087 billion for the quarter ended Sept. 30, driven by a $1.093 billion fair-value gain on its bitcoin, CEO Rapha Zagury wrote in a shareholder letter filed with the SEC on Friday.
The gain came from the coins rising in price. "A balance sheet is not a business," Zagury wrote.
How a paper gain shows up as profit
Under U.S. accounting rules (GAAP), XXI marks its bitcoin to fair value each quarter. When the price rises, the increase counts as income even if no coin is sold. When it falls, the drop counts as a loss.
The letter says XXI held 43,514 bitcoin at quarter-end, valued at about $83,700 per coin, or roughly $3.64 billion. Bitcoin traded near $68,400 at 5:57 p.m. ET Friday, per CoinGecko. At that price the same holdings would be worth about $2.98 billion, roughly $666 million less, by Black Mint's calculation. The company has not reported a fourth-quarter figure.
Debt backed by coins
XXI had $102.8 million in cash and $486.5 million of convertible notes outstanding, secured by about 16,116 bitcoin, the letter says. A convertible note is a loan that holders can later swap for shares. At Friday's price, that collateral is worth about $1.1 billion, a bit more than twice the note principal, by Black Mint's math.
What the CEO says comes next
Zagury wrote that XXI is looking at businesses in mining, lending, treasury and energy, and has walked away from deals where "the economics or terms did not make sense." He said share buybacks "deserve serious consideration" when the stock trades below the value of the assets behind it, subject to liquidity and approvals. He also said the company is still defining plans to fund independent Bitcoin development and security research, including AI-assisted bug hunting and quantum threats.
The letter names no deal and no buyback amount.
In our opinion: the letter is frank that a $1.09 billion profit is mostly the price of bitcoin doing the work. The same accounting cuts the other way this quarter, so the number to watch is the fourth-quarter fair-value line. A first acquisition, or a buyback with a dollar figure, would be the first sign the operating plan is more than a letter.
Sources: Twenty One Capital shareholder letter (Exhibit 99.1 to Form 8-K, SEC EDGAR, Nov. · CoinGecko: bitcoin price (Nov. 13, 5:57 p.m. ET) · Twenty One Capital investor site
Revisions
First published .
No revisions since publication.
We fix errors and say so. See every correction on the Blackmint corrections page.