Strike CEO Jack Mallers Announces Proof of Deposit Loans, Fixed-Proof Loans, and Backs Tether Merger Plan
Strike CEO Jack Mallers announced a series of product updates and strategic moves on Wednesday, including the launch of proof of lending, a new bitcoin-backed loan structure “backed by bitcoin built with Tether, and a $2.1 billion credit facility.”
He also said he supports Tether Investments’ proposal to merge Strike with Twenty-One Capital and bitcoin miner Elektron Energy.
Mallers said the Strike-backed loan business and line-of-credit business has grown since its launch, and users are attracted to the ability to borrow with bitcoin rather than sell it.
He described bitcoin as a savings account for many customers and said Strike had lowered its global standards. Pricing now ranges from about 10.5% APR for loans under $250,000 to about 7.49% APR for loans over $5 million.
Strike has announced the first iteration of its proof-of-lending, which gives borrowers the ability to verify that their collateral exists and is separated by a unique on-chain address.
“We want you to trust us and know that we are what we say we are,” said Mallers. The disclosure mechanism was developed in partnership with Tether, which Mallers credits for helping Strike build a transparent infrastructure.
The two companies have also jointly developed what Mallers calls “volatility-proof” bitcoin-backed loans, a structure that removes the risk of forced liquidation when bitcoin prices fall or broader markets decline.
Mallers said a split collateral product is now available through Strike’s private client desk, and a proof-of-concept loan feature is available to customers as part of the bitcoin-backed lending suite.
Mallers announced that Strike has secured a $2.1 billion loan facility, which he said gives the company the ability to meet demand for any order size within its lending business.
A merger proposal
Earlier on Wednesday, Tether Investments published a proposal to merge Twenty-One Capital with Strike and Elektron Energy, the largest bitcoin mining operator that manages about 50 EH/s, or about 5% of the current hashrate of the Bitcoin network.
Tether said that the combined organization will include bitcoin treasury holdings, mining, financial services, lending, and capital markets under one listed platform.
Mallers said he supports the plan. “Simply put, I think it’s a great idea,” he said, adding that building a Bitcoin company — not a small payment app — was his founding goal. Elektron founder Raphael Zagury has been promoted to President of the combined entity under the plan.
The bitcoin corporate quadrant and Maller’s view
Marketers used the quadrant framework on stage to argue that the Bitcoin industry has a gap where high conviction and high operating income meet.
He put crypto exchanges in the high-income, low-credibility corner, saying they run profitable businesses but list many coins and create products across asset classes. He placed bitcoin financial companies in the upper corner, with no revenue, describing them as deeply committed to bitcoin but limited in business performance.
He cited Coinbase as an exchange that could carry more bitcoin on its balance sheet, and praised MicroStrategy’s senior chairman Michael Saylor while drawing a distinction between treasury strategy and product strategy. “I like him and his company,” Mallers said of Saylor, “but I want to build bitcoin products.”
His response to this gap was a four-pillar model: a financial services arm that includes trading, custody, lending, payments, treasury, and advanced services; bitcoin infrastructure including energy, power generation, mining, hardware, and hosting; capital markets work built around loan bookkeeping, mining financing, bitcoin-backed loans, and structured products; and mergers and acquisitions that target profitable bitcoin businesses across software, storage, payments, energy, and distribution.
The stated goal of the M&A arm, as presented in his slide, is to give “every dollar of operating income one job: buy more Bitcoin.”
Mallers concluded that a platform of that scope “could change the world with its products” and quoted a phrase he has used throughout his career: “Fix the money, fix the world.”
