Tuesday, August 15, 2023
Source: Associated Press, Financial Times, Bloomberg (unspecified date in original)
Cantor Fitzgerald, a major American financial services company, is reportedly planning to acquire approximately $3.5 billion worth of Bitcoin from Blockstream Capital.
The deal is expected to involve Brandon Lutnick, the 27-year-old son of United States Commerce Secretary Howard Lutnick. According to reporting by the Financial Times and Bloomberg, Lutnick aims to acquire the digital asset through his firm.
The proposed deal structures the acquisition primarily through Cantor Fitzgerald’s special purpose acquisition company (SPAC), Cantor Equity Partners 1. This $200 million SPAC, established earlier this year, will receive roughly 30,000 Bitcoin (worth ~$3.5 billion at current valuations) in exchange for shares.
Blockstream Capital, founded by Bitcoin pioneer Adam Back, stands to receive Cantor Fitzgerald stock under the terms of this transaction, creating a commercial connection with the firm now helmed by Brandon Lutnick.
In conjunction with this deal, plans call for raising an additional $800 million internally to pursue further Bitcoin purchases, reflecting a significant and sustained commitment.
Cantor Fitzgerald’s move is significant as it would position the company among the world’s largest holders of Bitcoin. Including both this proposed BSTR Holdings investment and previous purchases, Cantor’s total crypto-related acquisitions for the year could surpass $10 billion.
Strategic Context
Legal finalization appears imminent for the deal, subject to potential refinements, although exact timing hasn’t been confirmed beyond prompt execution.
Cantor’s strategy, involving the establishment of dedicated Bitcoin acquisition entities, mirrors tactics employed by other significant players in the cryptocurrency sphere, such as Michael Saylor’s MicroStrategy, which has accumulated more than $70 billion in Bitcoin since 2020.
Adam Back, the founder of Blockstream Capital and a key figure in Bitcoin’s history, has contributed foundational technical work to the cryptocurrency.
