Behind the alliance between SoftBank and Tether: US dollar hegemony reconstructs global finance with BTC

Note: On April 23, 2025, Cantor Fitzgerald, headed by the son of U.S. Commerce Secretary Howard Lutnick, announced a new company called 21 Capital in cooperation with SoftBank, Tether and Bitfinex.

According to the documents submitted by 21 Capital to the U.S. SEC, the company plans to start with a reserve of $3.5 billion in BTC (42,000 coins), of which Tether will contribute $2.05 billion in BTC (24,153 coins), SoftBank will contribute $891 million in BTC (10,500 coins) and Bitfinex will contribute $594 million in BTC (about 7,000 coins). Each BTC is valued at about $85,000. It is worth noting that Tether and Bitfinex are owned by the same parent company and have the same actual controller.

In response to the latest cooperation between Cantor Fitzgerald, SoftBank and Tether, Jeff Park, head of strategy at Bitwise Alpha, published an article to comment on their cooperation. He said that this is the biggest news that many people don't pay attention to. The cooperation between them is not just cryptocurrency, not just macroeconomics, but a comprehensive redesign of the global financial system with Bitcoin at its core. He believes that Japan's "lost decades" gave birth to SoftBank, and the dollar hegemony gave birth to Tether. Today, these two forces in the global financial field are joining forces.

The following is the full text of Jeff Park's sharp comment:

For decades since the 1990s, Japan has been trying to get rid of the dilemma of economic stagnation. In response, policymakers have implemented one of the most radical ultra-low interest rate policies in modern history, aimed at stimulating domestic investment and revitalizing economic growth. However, this policy did not trigger an economic recovery at home, but instead gave birth to one of the most influential financial distortion engines: "global carry trade".

First introduce the background. This global carry trade system is a form of financial repression. In developed economies such as Japan, structurally low interest rates have prompted capital to flow abroad in search of higher returns. Cheap yen flows into U.S. Treasuries, emerging markets, and speculative tech startups, creating the illusion of abundant global liquidity while quietly exacerbating systemic risk. In this context, Japan is no longer a natural engine of economic growth, but more like an unnatural global financial institution - dependent on the appreciation of external assets while its domestic productivity is shrinking and its currency is depreciating. SoftBank's rise, therefore, must be understood as an inevitable product of this system. SoftBank has taken funds from a suppressed monetary environment, engaged in financial arbitrage, and invested funds in high-growth, high-risk areas around the world with extremely high leverage, which is somewhat desperate. SoftBank is technically a public company, but it operates more like a “de facto sovereign wealth fund”, backed by state-linked entities such as Saudi Arabia’s Public Investment Fund (PIF) and Abu Dhabi’s Mubadala Investment Company, and plays a major role in strategic industries. Son has a quasi-nationalist streak historically, suggesting that this is not just about investment returns, but about reigniting the competitive spirit of Japan (and its partners) in an era of exponential technology, while fighting financial repression.

Because at the other end of the global system is the United States, which has long enjoyed what is called “exorbitant privilege”. As the issuer of the world’s reserve currency, the United States is able to borrow at lower rates while controlling the flow of dollars through tools such as SWIFT and sanctions. This is financial repression for other countries, but privilege for the United States, the issuer of the dollar. However, the United States’ abuse of its “exorbitant privilege” has not escaped the eyes of the international community (the most serious example is the freezing of Russia’s central bank reserves by the United States in 2022).

Now let’s talk about Tether. Tether is the unofficial “eurodollar” (note: offshore dollars saved outside the United States and not regulated by the Federal Reserve) manufacturing machine in the crypto era. Tether operates outside the traditional banking system and acts as a shadow central bank, exporting digital dollars to meet global demand without being constrained by US regulation. Like the eurodollar market in London after World War II, Tether enables overseas participants to access dollars while quietly earning interest rate differentials. If financial repression is a burden on the public, then Tether is the private loophole that the international community needs.

Against this backdrop, the emerging collaboration between SoftBank and Tether, through Cantor Fitzgerald, marks a critical geopolitical and financial inflection point. SoftBank and Tether are two entities shaped by the hegemony of the US dollar: one is the beneficiary of the weaponization of the US dollar, creating synthetic dollars in a regulatory gray area; the other is the product of the weaponization of the US dollar, forced to adopt a compliant but excessive leverage strategy to escape domestic economic stagnation.

This transformative collaboration is now converging as the trade war wakes Japan from its long slumber. If SoftBank can leverage Tether’s ability to move dollars without censorship control at the world’s lowest funding costs, it has the potential to redesign the global financial system from within as the largest sovereign creditor of the United States. This will be more than just a capital allocation, but a comprehensive system design - with Bitcoin at its core, and only Japan can do it.

With Tether as a partner, SoftBank may finally be able to turn things around, and as Michael Saylor might say: the most desperate are often the bravest.

For Japan, which has long been trapped in the inertia of external dependence, this is a rare opportunity to make its most strategic move in the crypto space.