Big event – 18 startups from 4 continents:
Event: Tekedia Capital Demo Day
Date: Saturday, April 26, 2025
Time: 4 – 6pm WAT
Zoom Link: https://capital.tekedia.com/course/fee/
Host: Tekedia Capital
Launch of Twenty One Capital by Jack Mallers Carries Significant Implications For Bitcoin Ecosystem
Jack Mallers, the CEO of Strike, has launched Twenty One Capital, Inc., a Bitcoin-native company focused on acquiring and holding Bitcoin, with an initial treasury of over 42,000 BTC, valued at approximately $3.6 billion based on a Bitcoin spot price of $84,863.57 as of April 21, 2025. The company is backed by major players like Tether, SoftBank Group, and Bitfinex, and is set to go public via a SPAC merger with Cantor Equity Partners, trading under the ticker $XXI on Nasdaq.
Twenty One aims to maximize Bitcoin ownership per share, offering investors direct exposure to Bitcoin through a public company structure, and plans to develop Bitcoin-native financial products, such as lending and capital market instruments. Mallers, who will continue his role at Strike, positions Twenty One as a vehicle to accelerate Bitcoin adoption, comparing its strategy to MicroStrategy but claiming greater flexibility for capital raises. The venture has raised $585 million through convertible notes and equity financing to support further Bitcoin purchases and operations.
The acquisition of 42,000 BTC reduces Bitcoin’s circulating supply, which could exert upward pressure on prices, especially given Bitcoin’s fixed supply cap of 21 million coins. This aligns with the narrative of Bitcoin as “digital gold” with scarcity-driven value. Twenty One’s plans for further Bitcoin purchases, supported by $585M in financing, could amplify this effect, potentially contributing to price volatility or sustained bullish trends if demand remains strong.
Twenty One’s focus on developing Bitcoin-native financial products (e.g., lending, capital market instruments) could bridge traditional finance and crypto, creating new use cases for Bitcoin beyond speculation or holding. This might attract more sophisticated investors and integrate Bitcoin deeper into global financial systems. By leveraging Bitcoin as collateral or a base asset, Twenty One could pioneer scalable DeFi-like solutions within a regulated framework, potentially challenging existing crypto lending platforms.
Positioning itself as a more flexible alternative to MicroStrategy, Twenty One could spark competition among Bitcoin-focused public companies, driving innovation but also raising risks of over-leveraging or speculative bubbles if valuations disconnect from fundamentals. The involvement of Tether raises questions about stablecoin-backed Bitcoin accumulation strategies, which could invite regulatory scrutiny given Tether’s controversial history.
As a publicly traded entity, Twenty One will face stricter regulatory oversight, which could set precedents for how Bitcoin-centric companies navigate compliance, custody, and reporting. This might legitimize Bitcoin in the eyes of regulators but also expose the company to legal risks if crypto regulations tighten. The SPAC structure and reliance on convertible notes carry financial risks, especially in volatile markets. If Bitcoin’s price crashes, Twenty One’s valuation and investor confidence could suffer, impacting its ability to raise capital.
Mallers’ vision to accelerate Bitcoin adoption through Twenty One could amplify Strike’s efforts in payments and remittances, reinforcing Bitcoin’s utility. Success here might inspire similar ventures, further embedding Bitcoin in everyday finance. However, the focus on Bitcoin exclusivity might sideline other cryptocurrencies, reinforcing Bitcoin maximalism at the expense of broader blockchain innovation.
Twenty One’s launch reflects a maturing crypto market where Bitcoin is increasingly viewed as a strategic asset rather than a speculative gamble. This could shift public perception, especially among traditional investors. Mallers’ dual role at Strike and Twenty One positions him as a key figure in Bitcoin’s narrative, potentially influencing market sentiment and policy debates around cryptocurrency.
Twenty One Capital could catalyze Bitcoin’s mainstream integration, drive price dynamics, and innovate financial products, but it also faces risks from market volatility, regulatory challenges, and competitive pressures. Its success will hinge on execution, Bitcoin’s long-term performance, and the broader evolution of crypto markets.
Starting New Companies, Why Most Fail and How to Prevent That – Ndubuisi Ekekwe
In the dynamic landscape of entrepreneurship, startups play a pivotal role in driving innovation and reshaping industries. These newly established companies, often rooted in the tech sector, embody the spirit of creativity and risk-taking that underpins entrepreneurial capitalism.
Today, join me at Tekedia Mini-MBA Live, as we discuss how to start new companies and how to make sure they thrive. Drawing lessons from Tekedia Capital, we share some lessons we have identified that separate startups that succeed from those which do not. In all elements, the number #1 enabler for success is making products and services that customers want. If you can make your customers fans, you will win their wallets, and if you can win their wallets, you have succeeded.
Yes, when customers LOVE your products, most problems in your startup will disappear because you are growing; everyone becomes a star. (Our goal is to provide you with knowledge systems to ensure your company thrives.) Indeed, the best investors are CUSTOMERS!
Thriving as a startup goes beyond ideas; it is all about execution and nothing but execution. And that means, delivering on the products, designed to fix frictions in the markets. We have these equation:
Innovation := invention + commercialization
Great Company := Awesome Product + Superior Execution
(Note, we did not say “idea’ because idea means nothing. It is execution which enables ideas to become products, and that is what brings the wins).
Sat, Apr 26 | 7pm-8.30pm WAT | Starting New Companies, Why Most Fail and How to Prevent That – Ndubuisi Ekekwe | Zoom link https://school.tekedia.com/course/mmba17/
Trump Considering Temporary Exemptions Pause on 25% Tariffs on Automotive Imports
President Donald Trump has been considering temporary exemptions or pauses on the 25% tariffs he imposed on imported vehicles and auto parts, particularly to give U.S. automakers time to adjust their global supply chains. These tariffs, which took effect on April 3, 2025, for vehicles and are set to apply to auto parts by May 3, 2025, aim to boost domestic manufacturing but have raised concerns about higher car prices and supply chain disruptions.
Trump has signaled potential relief for automakers, particularly for vehicles and parts compliant with the United States-Mexico-Canada Agreement (USMCA). For instance, a one-month exemption was granted on March 5, 2025, for USMCA-compliant autos from Canada and Mexico after discussions with Ford, General Motors, and Stellantis. This reprieve was extended to include auto parts and other supplier products.
As of April 23, 2025, the White House confirmed Trump is considering further exemptions, potentially sparing some auto parts from tariffs, following intense lobbying by industry groups. The Financial Times reported that while the 25% tariff on imported vehicles would remain, certain auto parts might be exempt, though the 25% duty on parts is still expected to proceed.
The tariffs have already disrupted the auto industry, with companies like Jaguar Land Rover and Audi pausing exports to the U.S. and Stellantis idling factories in Canada and Mexico. Experts warn that short-term pauses, like the one-month exemption, are insufficient for reconfiguring complex supply chains, and tariffs could increase car prices by $3,000 to over $10,000, depending on the model.
Ford, GM, and Stellantis have expressed gratitude for the exemptions but emphasized the challenges of rapidly shifting production. Some automakers, like Ford and Stellantis, have offered temporary employee pricing programs to mitigate price hikes, while Hyundai and Genesis pledged to hold prices steady for two months.
Critics, including some analysts and Tesla CEO Elon Musk, argue the tariffs will raise costs across the board, as no vehicle is 100% U.S.-made. However, the United Auto Workers union and Trump supporters like Senator Bernie Moreno back the tariffs, claiming they protect American jobs.
The exemptions reflect Trump’s flexibility amid economic and political pressures, but the lack of a formal process for tariff relief keeps the industry uncertain. Automakers continue to lobby for parts exemptions to avoid compounding costs, especially with additional tariffs on steel and aluminum looming. Tariffs on vehicles and parts are projected to increase car prices by $3,000 to over $10,000, depending on the model. Exemptions could temporarily limit these hikes, but without long-term relief, consumers may face higher costs, potentially reducing demand and impacting auto sales.
Broad tariffs risk fueling inflation, as higher production costs ripple through supply chains. Exemptions may mitigate this in the short term, but sustained tariffs could still drive up costs for goods reliant on imported components. Higher vehicle prices could dampen consumer spending, a key driver of U.S. GDP. Exemptions might preserve some economic stability, but prolonged uncertainty could deter investment in the auto sector.
Industrial Implications
The auto industry relies on complex global supply chains, with many parts crossing borders multiple times. Exemptions, especially for USMCA-compliant goods, could ease immediate disruptions, but short-term pauses (e.g., one month) are insufficient for reconfiguring supply chains, which could take years. Tariffs aim to boost U.S. production, and exemptions may encourage automakers to shift some operations stateside. However, the high cost and time required to build new plants limit rapid change, and parts tariffs could still raise costs for U.S.-assembled vehicles.
Foreign automakers like Jaguar Land Rover and Audi have paused U.S. exports, and others may follow without exemptions. This could reduce competition but also strain U.S. dealers and limit consumer choice. Tariffs on Canada and Mexico strain USMCA ties, despite exemptions for compliant goods. Retaliatory tariffs from these allies (e.g., Canada’s proposed $3.6 billion in duties) could escalate tensions and harm cross-border trade.
Broad tariffs, even with exemptions, signal protectionism, potentially prompting other nations to impose counter-tariffs. This could disrupt global trade flows and isolate the U.S. in automotive markets. While Trump’s tariffs target Chinese vehicles (with a 100% duty), exemptions for USMCA partners may shift focus to countering China’s growing auto export influence, though higher costs could inadvertently make Chinese EVs more competitive globally.
Social and Political Implications
Tariffs are supported by unions like the United Auto Workers for protecting American jobs, but factory idling (e.g., Stellantis in Canada and Mexico) risks layoffs. Exemptions could stabilize employment temporarily but not address long-term shifts. Trump’s tariff policy, with selective exemptions, strengthens his negotiating power with automakers and trade partners. However, criticism from industry leaders and figures like Elon Musk could erode support if economic fallout grows.
Rising car prices could frustrate consumers, especially middle-class households, potentially undermining Trump’s economic agenda. Exemptions may soften this blow, but ongoing uncertainty could fuel public discontent. Automakers face uncertainty in planning long-term investments due to unpredictable tariff policies. Exemptions provide short-term relief but don’t resolve the broader risk of fluctuating trade rules.
Tariffs could slow the shift to electric vehicles (EVs) by raising costs for imported components critical to EV production. Exemptions for parts could support EV manufacturing but may not offset broader tariff impacts. Over time, tariffs may force a restructuring of global auto supply chains, with more production moving to the U.S. or USMCA countries. However, this shift requires significant capital and time, and exemptions may only delay the inevitable cost increases.
While exemptions could provide temporary relief for automakers and consumers, they don’t fully address the broader economic and industrial challenges posed by tariffs. The policy’s success hinges on balancing domestic manufacturing goals with minimizing disruptions, but prolonged uncertainty risks long-term damage to the auto industry and U.S. trade relations.
US Federal Reserve Announces Withdrawal of Its 2022 Supervisory Letter on Banks Processing Crypto
The Federal Reserve announced the withdrawal of its 2022 supervisory letter (SR 22-6 / CA 22-6), which had required state member banks to notify the Fed in advance of engaging in crypto-asset-related activities. It also rescinded a 2023 supervisory letter (SR 23-8 / CA 23-5) that outlined a nonobjection process for banks engaging in dollar token (stablecoin) activities. Additionally, the Fed, alongside the FDIC and OCC, withdrew two 2023 joint statements cautioning banks about crypto-related risks.
This shift eliminates the prior notification and approval requirements, allowing banks to handle crypto transactions under standard supervisory processes. The move aligns with evolving risk assessments and aims to foster innovation, reflecting a more permissive stance under the Trump administration. Banks are still expected to manage risks like volatility, cybersecurity, and compliance with laws, but the regulatory burden has been significantly reduced, potentially enabling broader crypto adoption in banking.
Banks no longer need prior Federal Reserve notification or nonobjection for crypto-asset or stablecoin activities. This reduces bureaucratic hurdles, enabling faster integration of crypto services like transaction processing, custody, or stablecoin issuance. Lower regulatory friction may encourage more banks, especially smaller state member banks, to engage with crypto markets. This could lead to broader mainstream adoption of cryptocurrencies and stablecoins in traditional finance.
The move signals a pro-innovation stance, likely influenced by the Trump administration’s crypto-friendly policies. Banks may explore new products, such as crypto payment systems or tokenized asset services, fostering competition and technological advancement. Despite deregulation, banks must still address crypto-related risks (e.g., volatility, cybersecurity, AML/KYC compliance). Supervisors will monitor these under standard frameworks, meaning banks need robust risk controls to avoid regulatory scrutiny.
Easier bank access to crypto could enhance liquidity and stability in crypto markets, as institutional involvement grows. It may also drive demand for stablecoins and other digital assets, potentially impacting their valuation and use cases. The U.S. is positioning itself as more crypto-friendly, potentially competing with jurisdictions like the EU or Singapore. However, it risks falling behind if comprehensive crypto legislation lags, as regulatory clarity remains incomplete.
Reduced oversight could expose banks to crypto market volatility or illicit finance risks if risk management is inadequate. This might lead to future regulatory tightening if incidents occur. Overall, this shift fosters a more permissive environment for banks to engage with crypto, likely accelerating its integration into traditional finance, but it hinges on banks’ ability to manage risks effectively.
With reduced regulatory barriers, banks may more readily engage with DeFi protocols, such as by facilitating transactions, providing custody for DeFi-related assets, or integrating with stablecoin ecosystems (e.g., USDC, USDT). This could create on-ramps for traditional finance users to access DeFi. Banks processing crypto transactions could funnel institutional capital into DeFi platforms, increasing liquidity in decentralized exchanges (DEXs), lending protocols, and yield farming pools.
Stablecoin Adoption in DeFi
The removal of the nonobjection process for dollar token activities may encourage banks to issue or support stablecoins, which are critical to DeFi’s ecosystem (e.g., for trading pairs, lending, and collateral). This could enhance stablecoin reliability and trust, driving DeFi adoption. Banks might develop their own stablecoins or partner with existing issuers, integrating them into DeFi protocols, which could reduce reliance on non-bank issuers and align DeFi with regulatory standards.
Centralized vs. Decentralized Services: As banks offer crypto services (e.g., custody, trading, lending), they may compete directly with DeFi platforms, which provide similar functions without intermediaries. Banks’ regulatory compliance and trust could draw users away from DeFi, especially for institutional or risk-averse clients. Some banks might integrate DeFi protocols into their offerings (e.g., using DEXs for liquidity or yield farming for client portfolios), blurring the line between centralized and decentralized finance.
As banks engage with DeFi-related assets or protocols, regulators may focus more on DeFi’s risks (e.g., smart contract vulnerabilities, money laundering). This could lead to future regulations targeting DeFi, potentially stifling innovation or forcing protocols to adopt compliance measures. Bank involvement could lend credibility to DeFi, encouraging regulators to create clearer frameworks rather than outright bans, fostering a more stable environment for DeFi growth.
Bank participation could spur DeFi protocols to innovate, offering more sophisticated products to compete with bank services (e.g., advanced yield strategies, cross-chain interoperability). Banks acting as gateways could make DeFi more accessible to retail users unfamiliar with wallets or blockchain interfaces, expanding DeFi’s user base.
Bank involvement might undermine DeFi’s decentralized ethos, as institutions could prioritize permissioned or semi-centralized systems. This could fragment the DeFi ecosystem between purist protocols and bank-friendly hybrids. Increased institutional capital could amplify volatility in DeFi markets, as banks’ large-scale transactions impact token prices or liquidity pools.
The policy shift aligns the U.S. with crypto-friendly jurisdictions, potentially attracting DeFi developers and projects to operate domestically. However, without comprehensive crypto legislation, DeFi’s regulatory uncertainty persists compared to regions like the EU with MiCA frameworks. The Fed’s deregulation could bridge DeFi with traditional finance, boosting liquidity, stablecoin use, and user access while fostering competition and innovation. However, it may also introduce regulatory scrutiny, centralization risks, and competition from banks, challenging DeFi’s decentralized principles.