Jack Mallers on Leaving 21: "Now I Can Tell You Whatever You Want"

Now that I'm not a public company officer, I could tell you whatever you want. In that respect, I'm back.

What happened was the company's direction and what I started and what I wanted to build were no longer the same. That was a very unique moment for me where it was like, okay, here's a blank check and here's what you anything you want. Like, are you willing to sell out? I just couldn't. There's just no way. Reality is like I failed in many ways and I own that.

Well, I mean,

Yeah, I'm good. I'm healthy. I'm happy. I'm getting married. So in that respect, I'm good.

But no, of course. I mean, complicated, obviously. Emotions all over the place. I think stepping down from 21 was the right thing to do. But it sucks. I helped start that business. And those are my friends, still are. And so, obviously, there's part of that's complicated, but I think it was the right thing to do for a variety of reasons. And now that I'm not a public company officer, reporting to the SEC, I could tell you whatever you want. So you can ask in that respect, I'm back, so you can ask me whatever you want.

That's true. That's overwhelming. I saw that.

Yeah, I mean, so there's a lot of lore here. I co-founded 21 with Tether and like what does that even mean? Tether was founded by and the chairman of the business is a guy named Junk Carlo, which people don't he's just not a very he doesn't like attention. I don't know. I want to speak for him, but that's my interpretation of our friendship. And then the other is Paulo, who is the CEO. People maybe are more familiar with that name. So it's those two predominantly that I spent time with. And I mean everything from defining the vision where we aligned. We both we've the three of us have been in Bitcoin each for over 10 years. I think Junk Carlo was a little bit before me maybe circa 2011 2012 I was 2013 Paulo shortly after that. So just been around for a long time been friends and we had aligned on a vision that was fairly unified. So I'm using my hands for the podcast listeners, but I think we view the space on a spectrum where maybe on one side you've got a Coinbase or a Robin Hood, and these are businesses that I think the capital markets are accustomed to. They have customers, they have cash flow, they have products, they have growth, they have a vision that is easy to understand, and they have KPIs that people are used to. And that all is great, makes sense. These companies are worth tens of billions of dollars. They're able to produce billions of dollars of cash flow and they have growth prospects and you can value these businesses on like a discounted cash flow model or maybe tech is getting a certain multiple. Okay, but they don't believe in Bitcoin at least the way that I do, at least the way that Tether does, at least the way that someone like Michael Sailor does, which I would consider the opposite side of the spectrum, which is a business like strategy that believes in Bitcoin deeply, has that conviction, but lacks all of the properties I just described. Doesn't have products, doesn't have customers, doesn't have cash flow. It is strictly self-described as capital markets financial engineering. And so here you have two polar opposites where I don't think it's a secret that Coinbase has openly cared more about Ethereum and altcoins and their own blockchain than Bitcoin itself. And if you look at their balance sheet, they've got 10, 11 billion and less than one is Bitcoin. So if money is conviction expressed monetarily, like they don't clearly they believe what's their belief in Bitcoin? What's the math on that? Less than 10% belief in Bitcoin. Whereas Michael Sailor can make the argument he's over 100% belief in Bitcoin because that's what he sells. Like I believe the most and I'm the most levered and anyone that buys my equity gets the most performance. And we viewed those as polar opposites. Now, as businessmen in this space that have been around Bitcoin for a long time, we figured, man, the dream and what the capital markets is surely going to be interested in is some happy medium where I don't necessarily believe fully or I'm not, it's not even about belief in what's right and what's wrong. I'm not interested in perpetually financial engineering. I want to build products. I want to support the adoption of Bitcoin. I want to build tools. I mean, eventually we're going to need financial services and all sorts of stuff. And I've built that at Strike and Tether's built that at Tether. And we're like, okay, can we build a business that has products and cash flow and growth prospects whilst also displaying an immense amount of singular focus conviction in this Bitcoin thing? And we that was our vision. That's still the vision I believe in. That's what I'm building at Strike. You know, listen, we don't have the second biggest treasury in the world, but we got a big one and we're profitable and we're growing and we're building tools that promote Bitcoin adoption. And so that's still my belief. And what happened was the company's direction and what I started and what I wanted to build were no longer the same. Which is okay. It doesn't make anyone a bad person. Ultimately smart good people can look at an opportunity and arrive at different conclusions as to what they want, but 21 was never mine. It was always up to the board. Tether makes up the board and so at a certain point we began to disagree and not only was I not interested in building something that wasn't my vision and what I wanted to build, I'm also not the right person to lead it. My face shouldn't be on it and I didn't have I mean in the bones that make up my body. I don't have it in me to look you in the eye and tell you to invest in a business or support a business or be interested in a business that I don't truly believe in. Doesn't make it a bad business. It has everything it needs to be successful, but it just for all of those reasons, it was the right decision. But anyway, that was the vision. We I mean I came up with the name, I registered the ticker, I designed the logo. I mean, we created it. And so it's super unfortunate.

No, I mean so some more just background of 21 lore and for the record, few few things almost disclaimers. I'm not at the company anymore. Doesn't mean the company can't be extremely successful. It's the second largest treasury in the world or in the corporate world. It's also public. There's a lot of people that tried to go public and tried to build a big treasury and it didn't work and it failed. And we achieved that and the business has world-class backing, a world-class board full of Bitcoiners who have been immensely successful and they have everything they need to succeed their way. It's just not a way that I wanted to lead and for that reason I shouldn't be leading it. So, just to be clear and I don't want to speak on behalf of the business. I mean, I don't engage with lawyers the way I do now that I'm not a public company officer. I'm happy to just speak my mind. I probably am legally not allowed to speak on behalf of the company, but I'm also just as a good person not interested in it because it's not my place. It's their thing. So I just want to be clear. You're not going to get the future of the business from me. However, I can tell the story. So, we were the first, what I would say like treasury company of this little era of this now bear market and you said everyone is struggling. We were the first, we were before, I'm trying to think of the file, Adam Bax one, Nakamoto. This was April 2025 when we got it off the ground and announced it. And the market was very different back then. It was not immensely crowded. The Bitcoin price was going through. I don't think 2025 was a real bull run. I've been in the space for a long time. I don't count it. But it wasn't a bear market. The price was going up. There was liquidity and exuberance and excitement. And so that time was very different than by the time the business had gotten through approval from the SEC to list on the New York Stock Exchange. And mind you, we were at the finish line. We thought we were going to get approved that summer. Which obviously would have made for better timing. And then I don't know if you remember, but the government shut down in October. And so the SEC is part of the government. So it was a hilarious thing. Like we're ready to run the business and well the government someone plugged the government back in. What do you mean it's not on? And they couldn't approve us. And so we didn't get approved until December. And so by the time you do your annual filings and you're approved and I we weren't allowed to do anything before that approval, the market had changed. The definition of MNAV has changed 700 times. The premium to the equity of selling the ATM has changed. All of a sudden, convertible instruments were not the strategy and it was preferred and which the market changes and what a strategy could be considered and what we initially thought and then now we have to figure out okay well where's the market today? What's the appropriate way to finance things? What's the appropriate way to achieve our vision? And I would say it was then in more like the more recent months where it was like okay well the world has changed since we started it and unfortunately the world changed drastically since we went from filing to approval and we started to reassess things and I will tell you Natalie, even I would, I don't think people know this, when we started the company, like Strike being a part of 21 was not only not part of the conversation, I was very explicit. I was concerned. I was like, "Guys, I'm not like a serial entrepreneur." I don't like being an entrepreneur for the sake of entrepreneurship. These type of Silicon Valley personalities of "Oh, I've founded 12 companies and seven exits." screw that. Am I allowed to curse? Building businesses is immensely difficult. I don't love like when I'm done with Strike and Bitcoin, I'm done. I'm not founding anything else. And so when they were like, "Come on, we really should do this. This is a huge opportunity and we believe." I was like, "Guys, I just got Strike working." It's Strike almost failed a thousand times. It's so painful. I don't want to have to do the equivalent of living in the slums of El Salvador again.

No, never. I said very specifically, I'm worried. I already have this thing. It was so hard and you know how is that going to and everyone was like just be a CEO of both. There's plenty of people like Dorsey was the CEO of two companies, Elon right now, and we can support you in that. Let's not let that get in the way. But I was very clear about it. It's meaningful to me that Strike is mine and that when I look a customer in the eye or a Bitcoiner in the eye that they're trusting me and I think that my story and Strike story is very important to Bitcoiners which we should probably talk about. But anyway, eventually the market started to really like investors were coming to the board and saying the market wants Jack to consolidate. When Jack announces something or does a keynote, is he talking about the thing that I bought or what's the difference? And so there started to be pressure which wasn't secret backdoor dealing type of pressure. It was the market was starting to say, hey, a way to bootstrap this is to and so that's when it was like, okay, well now that's a change. So I think you asked like what changed? Well, that's a change. Because when we sat, I'll never forget what I would consider more of the founding meeting of hey, what should we name it? What's our timeline? Who needs to be involved? How are we going to source the capital? All of that. It was explicitly I was very explicit of like I don't you know it was hard enough for me to build one thing and I'm not serially interested in being a business builder. screw that. I'm a Bitcoiner. I'm not a Silicon Valley entrepreneur. I built Strike because I care about Bitcoin, not because I care about I don't do business for the sake of business. screw that. So anyway, yeah.

No, I mean it's just important for people to understand what capital markets are and why they work the way they work. They're designed to attract liquidity and investment to be extraordinarily efficient. I mean, the mere fact that we can have the amount of actively traded volume and price discovery and investment that companies can raise billions of dollars at whim's notice through all certain different vehicles. I if you didn't try and build an environment and a structure that helped ensure that the counterparty risk you were taking was vetted and checked. Like what if you were dealing with someone unethical? What if you were dealing with someone fraudulent? Now we could do a very Austrian free market approach to that which is every deal that you want to do you got to fly to the person's house you got to shake their hand you got to audit their books that would be the very libertarian Austrian kill big corp kill the state but obviously the United States has a huge interest in attracting capital attracting investment attracting liquidity and so they build regulations to create what we know as the capital markets and so embedded in that is that if you want to operate within that and you want to gain benefit from that, then you need to follow the rules because the rules in theory are supposed to govern everyone's ability to not get scammed, not get cheated, not deal with a fraudster. Now, as Bitcoiners, has reality matched the intent? I obviously disagree with that. I didn't enjoy being a public company officer. I like running my business my way and being my own man and saying what I want my way. But it doesn't mean that the intent and why it exists doesn't make sense. Like I get it. When we were going to list, we pick the primary market maker for our equity. Who do we want to be the algorithmic provider of equity liquidity? And you meet with Citadel and you meet with all these folks and it's like okay, it makes sense. Citadel's basically going to plow a ton of money into providing our equity liquidity so that we can raise capital so that our investors can get in and get out and so that it's an attractive place for capital. And Citadel doesn't know, Ken Griffin has never shaken my hand. He doesn't know my balance sheet. He probably doesn't understand Bitcoin at all. He probably needs to read your book. And so, how does he have the confidence to be able to just say, "Yeah, I'll turn this equity into something legitimate." Well, because it's in the capital markets and because capital markets has created an environment and a level of trust with its participants that people follow the rules. So I don't know. It's why it exists and I get it. But for me personally and the type of guy I am, it was excruciatingly painful. I didn't enjoy it at all. But that's okay.

No, no. I think Tether and I figured we were like, what Sailor taught us all is the pools of capital that actually are interested in Bitcoin. And even if they aren't explicitly interested in Bitcoin itself, they're interested in the returns it could generate or the asymmetry relative to their portfolio, there was either direct interest or a derivative of interest in this Bitcoin thing in the capital markets. And mind you, guys that have been in Bitcoin for over a decade, we're like, finally, here we go. Because it was foreign to us. It was always an anarchist libertarian tool and then a hacker developer tool and then I don't know how this happened. Then it was a nation state country but small emerging El Salvador tool and you grow and you grow and then MSTR came onto the scene and Tyler and I were like okay now we disagreed with a lot of what Sailor was doing though in this I'm going to perpetually financially engineer. Like okay could that work maybe I don't know we're not perpetual financial engineers so we have some questions we're dubious about some parts doesn't mean that we're smarter than everybody else and it's not going to work could totally work. But if these people in the capital markets in these pools of capital are interested in perpetual preferred stocks, wait until they see cash flow businesses and conviction into Bitcoin. You know what's the best thing for SATs per share is cash flow. That's the best non-dilutive easiest way to do it. And so that was the simple idea. And to be honest we were watching to wait for someone to do it. I was really waiting for Robin Hood or someone to say, "Man, displaying conviction in Bitcoin carries so much network effects, so many economies of scale." And we were waiting and then eventually with time, Tether and I almost came to this conclusion of like, well, if nobody's going to do it, that's the calling for people that build. And just because I didn't like being a public company officer doesn't mean it wasn't worth it. We wanted to do what we felt was right for Bitcoin, right for shareholders. And ultimately, why does anyone build anything? When we're gone, all that's left is what you've made. You want to build things that you want to see exist. And so it was a very simple, it wasn't more complicated than that. Unfortunately, it didn't work. And I do want to make sure I say, when I was talking to my chief of staff, Dylan, who's in the other room, I was nervous to come and do podcast again. Part of me is very excited to be back and unleashed. And my favorite part about my job or like where I found myself in my life is that I get to champion Bitcoin unapologetically and try and represent the people. But it's I didn't want a conversation like this almost to be like explaining myself in an effort to ask for forgiveness or ask for understanding, because the reality is I failed in many ways and I own that. And so I also want to set that record straight and be clear because I don't know when this conversation is going to end. But it didn't work and I laid out a vision and set expectations that ultimately weren't met too, which is part of the story. And some people were impacted by that. And that's real. And that's the guilt that comes with this story. And the unfortunate part of building things is sometimes it doesn't work. And like I said, it doesn't mean the company has failed. Company still has second largest treasury, public market access, and now it has a unified vision between leadership and the board that can go forward and they have a chance to turn the business into something that's meaningful to Bitcoin. But I just want the people out there to know that I'm not asking for forgiveness or understanding. I don't need that from people. I don't believe in pointing fingers or delegating blame. It's a culture that I've built at Strike for years is when an employee comes to me and says, "Don't look at me. It was that guy." I tell them, "You shouldn't have said that because now I know that guy determines outcomes, owns our fate, is the one ultimately with sovereign ownership and control over our destiny." So then I'm going to ask, why are you here? Are you only here to point at that guy? Do not point fingers. I don't believe in pointing fingers because then that by proxy assumes that you're not in control of your own life. You're not in control of your own destiny, your own decisions. It's not the Bitcoin way of approaching outcomes. So I was a CEO and I own it. So also want to make that clear.

Because I set out to do something and it didn't work. I think we live in a culture where people are afraid of failure. It's more complicated than that. In many ways, failure is wisdom. When you think of who are the wise, the elderly, the monk, you picture the monk at the top of the mountain who has tons of wisdom and is wise. He's not wise because he read five books that he ordered on Amazon. Or else we'd all be wise. He's wise through experience, through trial, error, failure. I wrote an essay that I was allowed to publish after I resigned where the premise is really about this idea of what punishments are not gifts. We mistaken gifts as punishment because in many ways failure is. So I failed and I tried to do something and it didn't work. Doesn't mean the company's not going to work and it doesn't mean it's not the best decision for me and for Strike and what I want out of this life. But I communicated a vision and I communicated expectations that weren't met and I need to own that and I need to understand why and what that means about me and what gifts and what lessons are embedded in that experience. It's only right and it's only what's best for me. You live in this culture of everyone's like afraid to own outcomes, afraid to own failures and it's I think it's wrong for them and their best interest and it's wrong for the greater interest of what they're trying to achieve. So that's what I mean. Like I would say if I have one regret to your point, we achieved stuff. We took a company public that was hard and there's a lot of Bitcoiners out there that tried to do what we did and failed. We built the second largest treasury. People will say, "Oh, all of that Bitcoin was pledged by Tether." That's not true. We raised a little under a billion and a half dollars, and we did buy Bitcoin with it. The catch, Natalie, is while the government was shut down, we technically couldn't buy Bitcoin with the cash we had raised until we got approved. And so I asked Junk Carlo and Tether, "Why doesn't Tether front us by buying the Bitcoin themselves and then we'll pay Tether back once we get approved?" Because we wanted the Bitcoin exposure right away. But we raised over a billion dollars. We bought over a billion dollars worth of Bitcoin. We compiled the second largest treasury. We went public. We tried a thing. And for all of those things, I'm immensely proud. I started a company that's public and has a chance to be one of the biggest Bitcoin companies in the world. And I'm proud of that whilst also regretting that I laid out a vision and communicated publicly to people expectations that weren't met. I would never been part of a board where I couldn't execute on what I thought was right. I had never been part of a capital markets and an infrastructure where things moved that slow. And I was used to Strike. Strike works very simply. Bitcoin's very decentralized. Strike's not. If we need to do something and I decide we do it, we do it. If we have a bug and customers are impacted and I say give every customer $20, that's what we do. And that's just not the way 21 worked. And so in hindsight, I should have communicated differently. I think expectations could have been set better. And ultimately, what I said I was going to do, I couldn't do. And that is the part that I failed.

Well I mean hopefully you hear about the future of the business from the company itself, not from the guy that thought it was best for everyone involved to step down. And so I would expect the company to communicate that fairly soon because if I was still leading it, that's what I would do. But I would say sorry is what I'm sorry it didn't work. I appreciate the support and I'm sorry it didn't work. And it doesn't mean, you know, you see people say, "Oh, it's a rug pull." Well, it's not like the 43,514 Bitcoin aren't sitting in our proof of reserves. I mean, you could see them. So the money's there, the business is there, the equity's on the New York Stock Exchange. But yeah, my involvement was no longer right and it's a lesson. You said authenticity, which I appreciate that. I take that as a compliment. But I think the word integrity also comes to mind. Humility. I view Bitcoin as the money of humility, of integrity. That's what an auditable public ledger that no one can change. It's integral. And my dad always told me the difference between a good man and a great man is the ability to do what is right, no matter how hard it is. Because people mistaken not doing the right thing for not knowing what is right. That's nonsense. We know in our bones, in our heart what is right. You know a ribeye steak is better for you than a pint of ice cream. You know in your heart that getting up and finding a way to the gym is better than lounging on the couch and eating chips. You know that the difference between right and wrong is known. It's the ability to commit to doing what's right despite how difficult it is. And that's what I would say is I'm sorry it didn't work out the way that I wanted it to, but this was what was right no matter how challenging. I mean because Natalie obviously I could have sold Strike. I could have stayed the CEO and I could have taken a gargantuan amount of money and perceived fame and access to the public markets and stuff. But that wouldn't have been what was right.