Crypto deal-making explodes in America as Trump tears up old regulatory playbook

Crypto deal-making in America is going through the roof after Trump kicked the old rules into the trash. Companies are rushing to take advantage of easier regulations and hope more regular people will jump into crypto.

Last week, the market got hit with a big new player: Twenty One Capital, a Bitcoin company that plans to go public through a $3.6 billion merger with a SPAC led by Brandon Lutnick, son of Commerce Secretary and close Trump ally Howard Lutnick.

Twenty One is backed by Tether and SoftBank Group. The company’s plan is simple but risky: It will buy billions of dollars’ worth of Bitcoin and take on debt to buy even more. Strategy, the software company that turned itself into a Bitcoin whale, first pushed this model.

Twenty One’s $3.6 billion deal is the third crypto deal topping $1 billion in just the past two months. Earlier this month, Ripple signed a $1.25 billion agreement to buy prime broker Hidden Road. Ripple is betting big that institutional investors will want a bigger slice of the crypto market.

In March, the crypto exchange Kraken made its own move, locking in a $1.5 billion purchase of futures broker NinjaTrader, creating one of the largest connections between crypto platforms and traditional finance.

Crypto companies bet big on new US regulatory atmosphere

While regular merger and acquisition activity drags, the crypto world is moving fast. Galaxy Digital is preparing for a direct listing on Nasdaq in mid-May after finally getting a green light from the SEC. Galaxy has been listed on the Toronto Stock Exchange since 2021, but will keep that listing even after it hits Nasdaq.

So far this year, 88 crypto deals have closed, totaling $8.2 billion. In comparison, 2024 saw 188 deals but only $2.9 billion in value. Eric Risley, founder of Architect Partners, said, “There’s optimism that finally things changed.” 

Risley said that bigger crypto companies are back in growth mode and using acquisitions to get even bigger. He added that 2025 could break the all-time record for crypto deal-making set in 2021 when deals hit $17 billion.

Just two years ago, crypto deals collapsed after FTX blew up and regulators came down hard. But now, with Trump back in charge, there’s a different vibe. Bankers and advisers expect a big wave of crypto deals. 

Trump has loaded regulatory agencies with crypto-friendly people and promised to make America the “undisputed Bitcoin superpower.” Congress, under Republican control, is also pushing laws to give digital assets a real legal framework.

Masayoshi Son’s SoftBank is heavily backing Twenty One. The company plans to kick off operations with about $4 billion worth of Bitcoin, coming from Tether, Bitfinex (Tether’s sister company), and SoftBank. Tether and Bitfinex will be the majority owners of Twenty One, and the company said it plans to raise another $585 million to grab even more Bitcoin.

Companies using this method dump huge amounts of Bitcoin onto their balance sheets and even borrow money to buy more, gambling that Bitcoin’s price will keep climbing. Strategy has already racked up over $50 billion worth of Bitcoin, making it the biggest corporate Bitcoin holder.

Shares of Cantor Equity Partners, the SPAC Twenty One is using to go public, have nearly tripled since the deal news broke. SPACs are shells built for the sole purpose of merging with private firms that want to go public without going through a traditional IPO.

Not everyone thinks this plan is smart. Veterans on Wall Street are warning that just buying and holding Bitcoin is a dangerous game. Bitcoin crashes have wiped out fortunes before. Strategy itself posted a brutal $5.91 billion loss for the quarter that ended in March because Bitcoin’s price dropped hard.

Tesla also reported a $125 million loss earlier this week on its Bitcoin stash. Elon Musk’s electric car company first told the world it was buying Bitcoin back in 2021, hoping it would pay off, but it has had a rocky ride ever since.