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Brandon Lutnick, son of US commerce secretary Howard Lutnick, is nearing a roughly $4bn deal with an early bitcoin supporter to buy billions of dollars in the digital tokens using a vehicle backed by Cantor Fitzgerald.
Cantor Equity Partners 1, a blank cheque vehicle that raised $200mn in cash in an initial public offering in January, is in late-stage talks with Adam Back, founder of crypto trading group Blockstream Capital, to buy more than $3bn in the digital currency, according to two people briefed on the talks.
The deal, which mirrors a $3.6bn crypto buying venture Brandon Lutnick struck with SoftBank and Tether in April, would advance Cantor Fitzgerald’s strategy of using publicly listed shell companies to buy bitcoin as it aims to take advantage of a surge in digital currency prices amid US President Donald Trump’s deregulatory push. Howard Lutnick handed control of Cantor Fitzgerald to his children in May.
Back is in discussions to contribute as much as 30,000 bitcoin to Cantor Equity Partners 1, worth more than $3bn. It would be part of a broader deal with the blank cheque company in which it would raise as much $800mn in outside capital to make further purchases of the digital currency, putting the overall deal at more than $4bn.
Back and Blockstream Capital would contribute their bitcoin in exchange for shares in the Cantor vehicle, which would be renamed BSTR Holdings.
A deal could come as early as this week, said the people, who cautioned that terms could still change. If completed in the coming days, it would come during what Republican lawmakers have dubbed “crypto week” as they debate legislation tied to digital currencies.
The deal would make Cantor one of the world’s most active crypto buyers. It is using blank cheque vehicles led by the younger Lutnick, 27, who was named chair of the brokerage in February when his father was confirmed to be Trump’s top trade official.
Cantor’s combined crypto purchases between its two vehicles, BSTR Holdings and Twenty One Capital, could reach nearly $10bn this year.
Cantor and Blockstream did not respond to requests for comment.
In the Blockstream deal, Cantor would partner with one of the crypto industry’s earliest supporters. Back is an early cryptographer whose work developing the Hashcash cryptographic proof was cited by the pseudonymous founder of bitcoin, Satoshi Nakamoto, in his bitcoin white paper.
The Hashcash proof-of-work system Back proposed in 1997 became the foundation for bitcoin mining — the process by which new bitcoins are created and verified. He is also the co-founder of California-based blockchain company Blockstream, which was founded in 2014 and is backed by Khosla Ventures and Baillie Gifford, among others.
Back has personally funded several companies that have stockpiled bitcoin this year, including Paris-listed The Blockchain Group, which announced on Tuesday that he had invested €5mn as part of an equity raise. Last month, he also funded a Skr150mn ($15mn) convertible bond for Swedish health technology and bitcoin treasury company H100 Group.
The Cantor deal would mark the latest in a series of high-profile deals where special purpose acquisition companies are used as vehicles to buy bitcoin, as investors seek to emulate billionaire bitcoin evangelist Michael Saylor’s company, called Strategy, in hoarding the digital currency.
Other groups that have recently gone on crypto-buying endeavours include Trump Media & Technology Group, the media and crypto trading company created by Trump and his family, and a blank cheque vehicle led by digital currency promoter Anthony Pompliano.
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