After Losing $130M in 2018, SoftBank Is Back in Bitcoin—Could This Time Be Different?

SoftBank Makes a Return to Bitcoin Investment After $130M Loss—Is the Market Ready This Time?

SoftBank, the prominent Japanese investment firm, is re-engaging with the cryptocurrency market by backing a new bitcoin investment vehicle, Twenty One Capital. In partnership with Tether, Bitfinex, and Cantor Fitzgerald, this marks the firm’s renewed interest in bitcoin after a significant loss incurred by its founder, Masayoshi Son, several years ago.

For some, SoftBank’s return to the crypto market is seen as a welcome sign of increasing institutional adoption. The company, with its $308.7 billion in assets under management, is regarded by many as a major player, and its involvement in the crypto space gives the industry further credibility, according to Jeff Park, head of alpha strategies at Bitwise. SoftBank’s pivot could indicate that digital assets are increasingly being embraced by traditional finance.

However, for others who recall SoftBank’s previous foray into bitcoin, this development may feel more like history repeating itself.

Back in 2019, Masayoshi Son made headlines when his personal investment in bitcoin led to a massive loss. Son entered the crypto market in late 2017, at the peak of the bitcoin frenzy when the coin’s value neared $20,000. But by early 2018, as bitcoin’s price began to plummet, Son sold his holdings, ultimately facing a $130 million loss, according to the Wall Street Journal.

Had he kept his position, Son’s bitcoin holdings would have been worth significantly more today, with the price now hovering around $93,000. This has led many to wonder whether this new venture represents a smarter play for SoftBank or if it’s another gamble with uncertain results.

To gain a sense of what may lie ahead, it’s useful to examine SoftBank’s involvement in other sectors. Recently, SoftBank became part of a $100 billion initiative to build AI infrastructure alongside OpenAI and Oracle (ORCL). Initially, the announcement was expected to drive Oracle’s stock higher, but since then, Oracle shares have fallen by 28%, compared to a 12% drop in the broader Nasdaq index.

Some analysts have even suggested that SoftBank’s involvement may be a factor behind Oracle’s underperformance. “When SoftBank enters an asset you own, you sell. I don’t make the rules,” said Quinn Thompson, founder of crypto hedge fund Lekker Capital, pointing to the pullback in Oracle’s stock.

As SoftBank returns to bitcoin with Twenty One Capital, investors will be watching closely to see whether this new strategy can finally pay off or if it will once again result in another financial setback for the firm.