SoftBank has executed a full retreat from its position in Twenty One, selling its entire stake back to Tether as the venture's stock collapsed by 84% over recent months. The exit marks another high-profile stumble for the Japanese conglomerate's venture capital arm and raises questions about institutional appetite for crypto-adjacent investments during market downturns.
The dramatic stock decline that prompted SoftBank's departure unfolded over several months, wiping out the vast majority of the investment's value before the buyback arrangement with Tether was finalized. While specific financial terms of the exit weren't disclosed, the 84% stock drop suggests SoftBank likely absorbed substantial losses on what was once considered a promising position in the stablecoin ecosystem.
Twenty One's collapse represents more than just another failed venture capital bet—it signals potential cracks in the infrastructure supporting Tether's broader ecosystem initiatives. As the world's largest stablecoin issuer with over $100 billion in circulating supply, Tether's backing of Twenty One was seen as a strategic move to expand beyond pure stablecoin operations into adjacent crypto infrastructure plays.
SoftBank's willingness to sell back to Tether rather than seek alternative buyers or ride out the decline suggests the venture capital giant saw limited prospects for recovery. This decision pattern mirrors SoftBank's broader retreat from speculative tech investments following a series of high-profile losses across its Vision Fund portfolio in recent years.
The timing of the exit coincides with increased regulatory scrutiny of stablecoin operations globally, which may have contributed to Twenty One's operational challenges. Tether itself has faced ongoing questions about its reserve composition and regulatory compliance, factors that could spill over into subsidiary or backed ventures like Twenty One.
For institutional investors watching crypto infrastructure developments, SoftBank's quick exit serves as a cautionary tale about the volatility inherent in even Tether-backed ventures. The collapse also highlights the gap between crypto native companies and traditional venture capital firms in terms of risk tolerance and market understanding during prolonged downturns.
The buyback arrangement allows Tether to consolidate control over Twenty One's operations, potentially positioning the stablecoin issuer to restructure or wind down the venture according to its strategic priorities. Whether Tether can stabilize Twenty One's operations or will pursue a similar exit strategy remains to be seen, but the company's willingness to absorb SoftBank's stake suggests confidence in either recovery prospects or orderly dissolution value.
Written by the editorial team — independent journalism powered by Bitcoin News.