Tether and Bitfinex’s bitcoin company, Twenty One Capital (NYSE: XXI), reported net income of $1.087 billion for the third quarter on Friday 13 November, in a 10-Q filed with the SEC the same day. Almost all of it is one line: a $1.093 billion rise in the fair value of the 43,514 bitcoin it holds, marked at about $83,700 a coin on 30 September. The business itself lost $4.8 million before that mark, and the filing shows no revenue at all.
The quarter also ends a long way from where bitcoin trades now. At $68,830 at 17:33 UTC on 13 November, the same 43,514 coins are worth about $2.995 billion, roughly $648 million less than the $3.643 billion carried in the balance sheet six weeks earlier, by Coindaro’s calculation from the filing. If that price held to 31 December, the fourth quarter would hand back well over half of the third quarter’s gain.
Chief executive Rapha Zagury said as much himself. In a shareholder letter furnished with an 8-K on the same day, he wrote that the result was “primarily driven by a $1.093 billion fair-value gain on our Bitcoin holdings rather than operating cash flow.” The 10-Q adds what the letter does not spell out: the company bought no bitcoin this year, burned $13.3 million of cash in nine months, and its voting shares now sit entirely with Tether and Bitfinex.
Q3 2026 results at Twenty One Capital: a $4.8 million operating loss under a $1.09 billion profit
There is no operating business yet. Its statement of operations for the three months to 30 September has no revenue line. Operating expenses were $4.83 million, almost all general and administrative costs ($4.79 million), plus $35,000 of marketing. Interest on its convertible notes cost another $1.34 million. Everything else came from the bitcoin price.
Under the US accounting standard for crypto assets (ASU 2023-08), which the company applies, bitcoin held for investment is carried at fair value and send every change through the income statement. When bitcoin rises between two quarter-ends, the gain is booked as income even if no coin is sold. When it falls, the loss is booked the same way. That is how a company with no sales can post earnings of $3.13 per basic Class A share ($2.85 diluted) for the quarter.
The nine-month figures tell the other half. From January to September, Twenty One lost $186.5 million, because bitcoin was priced at $87,300 on 31 December 2025 and only $83,700 on 30 September. The change in fair value over nine months was a loss of $156.4 million. By Coindaro’s calculation from the filing, the first half of the year therefore produced a combined net loss of about $1.27 billion, of which $413.5 million came in the second quarter, as The Block reported in August. The accumulated deficit stood at $449.9 million at the end of September.
| Twenty One Capital (XXI) | Q3 2026 (three months) | Nine months to 30 Sep 2026 |
|---|---|---|
| Revenue | None reported | None reported |
| Operating expenses | $4.83M | $26.13M |
| Loss from operations | -$4.83M | -$26.13M |
| Interest expense | -$1.34M | -$3.98M |
| Change in fair value of bitcoin | +$1,092.9M | -$156.4M |
| Net income (loss) | +$1,086.8M | -$186.5M |
| Basic EPS (Class A) | $3.13 | -$0.54 |
| Bitcoin held at period end | 43,514 BTC | 43,514 BTC |
Source: Twenty One Capital Form 10-Q for the quarter ended 30 September 2026, filed 13 November 2026. Figures rounded from thousands of dollars.
What the 10-Q shows that the shareholder letter does not
Zagury’s letter is open about the nature of the profit and gives the main balance sheet numbers: 43,514 bitcoin, $102.8 million of cash, $486.5 million of convertible notes secured by about 16,116 bitcoin. It does not mention Tether, Bitfinex, SoftBank or the departure of the founding chief executive. It gives no share count, no buy-back authorisation and no figure for what the company has spent.
No bitcoin bought in 2026
The company held 43,515 bitcoin on 31 December 2025 and 43,514 on 30 September 2026. The one coin that left was paid to a vendor on 31 March; its cost basis was about $37,300. Nothing was bought in the year. The company’s own key performance indicator, bitcoin per Class A share, slipped from 12,557 satoshis to 12,553, a change of about -0.03% by Coindaro’s calculation. For a company whose 10-Q still lists “actively accumulating Bitcoin” as a planned business line, the holding has not grown since the end of 2025.
$13.3 million of cash used in nine months
Cash and equivalents fell from $117.7 million at the end of 2025 to $102.8 million at the end of September. Operating activities used $13.25 million over nine months, and financing used another $1.6 million, mostly to buy back shares from the former chief executive. Annual interest on the notes is about $4.9 million at the 1% coupon, by Coindaro’s calculation. At that pace the cash covers several years of running costs, and the notes are not due until 2030.
The filing says the accounts are prepared on a going-concern basis and that the company does not expect to need to sell bitcoin to meet its liquidity needs within twelve months. It keeps the door open to selling “under exceptional circumstances”, which it defines broadly: operational needs, legal or regulatory obligations, strategic investments or general corporate purposes.
Total assets of $3.75 billion against $488 million of liabilities
On 30 September, total assets were $3.752 billion, of which $3.643 billion was bitcoin. Liabilities were $488.0 million, nearly all of them the convertible notes, carried at $484.7 million. Shareholders’ equity was $3.264 billion. Those figures are a snapshot at $83,700 a coin, and they move by about $43.5 million for every $1,000 change in the bitcoin price, by Coindaro’s calculation.
The convertible notes: 16,116 bitcoin pledged, conversion near $13.87
The only debt is $486.5 million of 1.00% senior convertible notes due 2030, issued when the merger with Cantor Equity Partners, the Cantor-sponsored SPAC, closed in December 2025. The indenture, dated 8 December 2025, names Anchorage Digital Bank and U.S. Bank Trust. The notes convert at 72.0841 Class A shares per $1,000 of principal, which works out to about $13.87 a share by Coindaro’s calculation, close to three times the share price on Friday.
The market already prices them below par. The 10-Q puts their fair value at about $453.7 million, based on a quoted price of 93.25% of principal on 30 September.
They are secured by about 16,116 bitcoin, which the company says cannot be used for liquidity while they serve as collateral. At $83,700 that pledge was worth about $1.35 billion. At $68,830 at 17:33 UTC on 13 November, it is about $1.11 billion, still about 2.3 times the principal, by Coindaro’s calculation. The 10-Q does not set out any collateral top-up terms, so the filings do not say at what price, if any, more coins would have to be pledged. Its risk section warns that if the notes reach maturity without converting, the company may have to issue shares or sell bitcoin to repay them.
Who controls Twenty One Capital: Tether and Bitfinex hold all the votes
The company has two classes of stock. Class A shares, the ones listed on the NYSE, carry the economic rights but no votes, except where Texas law requires them, until every Class B share is cancelled. Class B shares carry one vote each and no economic rights.
On 19 May 2026, SoftBank sold all 89,106,748 of its Class A shares to Tether under an agreement signed on 15 May, the 10-Q says. The same number of SoftBank’s Class B shares was cancelled, and the governance agreement that had given Tether, Bitfinex and SoftBank the right to designate six of the seven directors was terminated. Cointelegraph reported on 20 May that the block was roughly 26% of the company; the price was not disclosed.
That left 215,736,011 Class B shares outstanding, the 10-Q shows. Twenty One’s 10-K lists Tether International with 156,331,512 Class B shares and Bitfinex (iFinex) with 59,404,499. Those two numbers add up to exactly 215,736,011, so, by Coindaro’s reading of the 10-K table together with the 10-Q, Tether and Bitfinex hold every voting share. On the economic side, Tether International’s 245,438,260 Class A shares (its original stake plus SoftBank’s block) are about 70.8% of the 346,659,785 Class A shares outstanding on 9 November, by Coindaro’s calculation.
At $4.96 a share at 17:35 UTC on 13 November, Tether’s Class A block is worth about $1.22 billion, by Coindaro’s calculation. That is the largest line in Tether’s portfolio of US-listed stakes, which Coindaro added up on 11 November.
A new chief executive, and the old one’s options expire
Jack Mallers, Strike’s founder and Twenty One’s first chief executive, left on 20 July 2026, as Strike pulled out of a planned three-way deal with Elektron Energy, according to The Block. Zagury, who founded Elektron and had sat on Twenty One’s board as an independent director, replaced him with effect from 20 July. Under the separation agreement, Twenty One bought back 226,860 of Mallers’ shares at $5.23 each, $1.19 million in all, on 6 August. It was the company’s only share repurchase of the quarter, and it was not part of a public programme.
Mallers also kept 1,522,407 vested options with an exercise price of $14.43 for 90 days. They expired unexercised on 18 October, the 10-Q says in its subsequent events note.
The board has a new member: David Goldschmidt, the former head of Skadden’s global capital markets practice, has joined it and its audit committee, according to the letter.
What bitcoin’s fall to $68,830 does to Twenty One’s fourth quarter
Bitcoin at $68,830 at 17:33 UTC on 13 November is about 17.8% below the $83,700 used in the 30 September balance sheet. On 43,514 coins, that gap comes to about $648 million, by Coindaro’s calculation from the filing. It is a quarter-to-date figure, not a result: the fourth quarter closes on 31 December, and only the price on that day counts. Bitcoin would have to get back to about $83,700 by then for the quarter’s mark to be flat.
The gap would cancel about 59% of the third quarter’s $1.093 billion gain. Add the running costs, about $5 million a quarter on the third-quarter run rate, and the year to date would be deeper in the red than the $186.5 million reported at the end of September.
| Measure (Coindaro’s calculation from the filing) | At $83,700 (30 Sep) | At $68,830 (13 Nov, 17:33 UTC) |
|---|---|---|
| Value of 43,514 BTC | $3.643B | $2.995B |
| Value of 16,116 pledged BTC | $1.349B | $1.109B |
| Pledged BTC / note principal | 2.8x | 2.3x |
| Change for each $1,000 move in BTC | $43.5M | $43.5M |
The shares trade well below the bitcoin behind them
XXI traded at $4.96 at 17:35 UTC on 13 November, according to stockanalysis.com, against a previous close of $5.00 and a 52-week range of $4.15 to $17.69. With 346.66 million Class A shares, that is a market value of about $1.72 billion, or about 57% of the value of its bitcoin at the same hour, by Coindaro’s calculation.
Netting out the $486.5 million of notes and adding the $102.8 million of cash gives about $7.53 of bitcoin and cash per Class A share. The share price is about 34% below that figure, and about 43% below the gross value of the coins, again by Coindaro’s calculation. The calculation ignores the dilution the notes would bring if they converted, which at today’s price they would not.
Zagury’s letter addresses that gap without naming it. “When our shares trade below the value of the assets attributable to them, repurchases deserve serious consideration,” he wrote, adding conditions on liquidity, approvals and applicable restrictions. No buy-back programme has been announced; the 10-Q’s table of repurchases shows only the 226,860 shares bought from Mallers.
What the letter says about mining, lending and energy deals
Most of the letter is about how the company will choose businesses to buy. Zagury said Twenty One is evaluating opportunities in blockchain and earns a reward, which makes rewriting history very expensive.">mining, lending, treasury and energy, and that it has walked away from some because the economics or terms did not make sense. He set bitcoin as the benchmark: any capital deployed should justify the risk and the opportunity cost of not simply owning more bitcoin.
On funding, the letter says the company will consider raising capital when the terms make sense, including borrowing when it believes it can comfortably service its obligations through a downturn. On open-source development, it says Twenty One is still defining how it would support independent bitcoin development and security research, including AI-assisted vulnerability detection and potential quantum threats.
The letter does not say whether the Elektron deal, described as under evaluation in August, is still alive. It gives no timetable for any acquisition.
Same accounting, different companies: Strategy, Trump Media and Bitmine
XXI is the latest in a run of third-quarter reports in which a crypto mark-up carried the bottom line. Strategy posted a record quarter on bitcoin marked at about $83,550, and its holdings face the same kind of gap at today’s price. Trump Media’s $410 million quarter was a $378 million bitcoin gain on $3 million of sales. Bitmine’s $6.3 billion loss ran the other way, on the ether price.
The differences matter more than the pattern. Strategy keeps buying bitcoin and issues preferred stock to fund it; Twenty One has bought none this year. Trump Media has a media business with small revenue; Twenty One has none yet. And Twenty One’s shareholders have no vote while Tether and Bitfinex hold the Class B stock. For readers new to the model, our glossary entry on the crypto treasury company explains how these listed bitcoin and ether holders work and why their profits swing with the coin.
What is still unknown
- The price Tether paid SoftBank for its stake in May has not been disclosed.
- The collateral top-up terms of the convertible notes, if any: the 10-Q does not give them.
- Whether any deal with Elektron Energy or another business is close: the letter names none.
The next hard numbers come with the 10-K for 2026, which will show the bitcoin mark at 31 December. Until then, each $1,000 move in bitcoin shifts Twenty One’s fourth-quarter result by about $43.5 million, before a single operating dollar is counted.