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Mallers merges Strike with Tether to build Bitcoin bank

Tuesday, May 5, 2026 · from 3 podcasts
Presidio Bitcoin JamBitcoin AndBitcoin 2026
  • Jack Mallers is merging payments app Strike with Tether’s mining business to centralize credit, mining, and liquidity.
  • The merged entity will offer volatility-proof Bitcoin loans, backed by Tether’s $2.1 billion credit line.
  • Block simultaneously targets mainstream users, while AI developers adopt Lightning because agents can’t open bank accounts.

Jack Mallers is constructing a financial institution inside the Bitcoin ecosystem, merging his Strike payments app with Tether’s mining and capital arms. On Bitcoin 2026, Mallers framed the move as building the “Ideal Bitcoin Company,” a vertically integrated giant that controls everything from energy procurement to consumer credit.

Host David Bennett on Bitcoin And sees the consolidation as the old finance playbook of M&A applied to a decentralized network. “The goal of the new entity is to funnel every dollar of operating income back into buying more Bitcoin,” he noted, arguing it creates a Bitcoin bank that mirrors the centralized institutions the network was meant to disrupt.

“This move aims to fix a market Mallers describes as split between ‘crypto casinos’ like Coinbase that lack conviction and treasury plays like MicroStrategy that lack operating products.”

- Bitcoin 2026

The merger’s core product is a volatility-proof loan, designed to let Bitcoin holders spend against their holdings without fear of a flash crash triggering liquidation. Tether is backing the expansion with a $2.1 billion credit facility. Meanwhile, Block is pursuing a parallel strategy for the mainstream, integrating Lightning tap-to-pay into Square terminals and auto-converting peer-to-peer Cash App payments to bitcoin.

A separate adoption wave is emerging from an unlikely source: AI. At the Hack Nation AI hackathon, Presidio Bitcoin Jam reported that 1,600 non-crypto developers chose Lightning because autonomous agents cannot open bank accounts or pass KYC. The need for machine-to-machine micropayments at AI speed made Bitcoin’s layer-2 network the only viable rail.

“Bitcoin is no longer just for the ideologically committed. It is becoming the inevitable plumbing for autonomous agents that are structurally excluded from the legacy banking system.”

- Presidio Bitcoin Jam

The industry is splitting between Mallers’ vision of a centralized, full-service capital provider and a counter-movement betting on self-custody. The test is whether a Bitcoin megabank can scale without repeating the failures of the system it aims to replace.

#BTC Markets#Adoption#Lightning#Payments
David BennettCoinbaseMicroStrategySquareStrikeTetherBitcoinCash App

Source Intelligence

- Deep dive into what was said in the episodes

Presidio Bitcoin Jam
Presidio Bitcoin Jam

Frontier Models Eating All, SF's AI Dominance, Bitcoin Vegas Announcements • May 1

  • Square's new NFC payment system allows users to tap their phone on a terminal to trigger a Cash App payment notification, aiming to match the seamless UX of transit systems like Tokyo's subway.
  • Cash App now offers 5% Bitcoin back on Square purchases paid with Lightning or Bitcoin through the end of the year, and users can auto-convert a portion of received peer-to-peer payments to Bitcoin.
  • San Francisco fintech Avon launched a Bitcoin-backed line of credit with a Visa card, allowing card swipes to draw from the credit line at LTV ratios between 30% and 70% and APRs from 7% to 11%.
  • Steve sees the merger of Strike, 21 (with Tether's backing and its $2.1B balance sheet), and mining firm Electron creating a powerful entity capable of servicing large Bitcoin-backed loans.
  • Spiral sponsored an 'Earn in the Agent Economy' challenge at a global AI hackathon, requiring Lightning Network use. The challenge attracted 73 project submissions from a largely non-Bitcoin audience.
  • Miles Suter previously stated that 8% of all Bitcoin block space is used for Cash App withdrawals, indicating a high volume of customers moving Bitcoin off the platform.
Also from this episode: (7)

Protocol (3)

  • Block announced BitKey now has a built-in touchscreen display enabling address verification for both sending and receiving Bitcoin, addressing a major initial criticism of the hardware wallet.
  • BitKey is a seedless, self-custody multi-sig wallet using a 2-of-3 setup with shards on the device, phone, and Block, featuring social recovery and inheritance planning. Block's potential failure does not prevent users from recovering their Bitcoin.
  • Block announced a proof of reserves for its Bitcoin holdings, similar to River's model, but DK contends Block's announcement did not include a corresponding proof of customer liabilities.

AI & Tech (4)

  • Block's Goose team presented Mesh LLM, a peer-to-peer network for distributing AI compute workloads, seen as a foundational substrate that could eventually integrate verifiable compute and Bitcoin payments.
  • DK argues corporations are moving non-mission-critical AI tasks to open-source models for cost and privacy reasons, but still rely on frontier models like Anthropic's Opus for core coding tasks due to superior performance.
  • Steve believes a 'sovereignty by design' AI service offering confidential compute without data sharing represents a major market opportunity, positioning it as a credible alternative to vendor lock-in with Anthropic or OpenAI.
  • DK cites data showing over 90% of AI company market capitalization is concentrated in the San Francisco Bay Area, reinforcing the region's dominance despite narratives of its decline.
#BTC Markets#Payments#Mining#Agents#Banking
Bitcoin And | Bitcoin & Economic News
Bitcoin And | Bitcoin & Economic News

Banksinos | Bitcoin News • Apr 30

  • Strike CEO Jack Mallers announced a $2.1 billion credit facility and new volatility-proof Bitcoin-backed loan structures built with Tether.
  • Strike cut its Bitcoin loan rates to approximately 10.5% APR for loans under $250k and 7.49% for loans above $5 million. Mallers said users are drawn to borrowing against Bitcoin rather than selling it.
  • Leishman framed Bitcoin banking as a third path, noting 50 countries have increased regulatory friendliness to Bitcoin in the last five years.
  • Steak and Shake Chief Maha Officer Michael Bows said Bitcoin payments cut the chain's processing costs by 50% and drove an 11% same-store sales increase quarter-over-quarter in 2025.
  • Bows said if all credit card users switched to Bitcoin, Steak and Shake would save $6 million annually. The company's strategic Bitcoin reserve has grown to $10 million.
Also from this episode: (8)

Mining (1)

  • Tether Investments proposed merging Strike with 21 Capital and the Bitcoin miner Electron Energy, which manages 5% of the network hash rate. Mallers endorsed the plan.

Society (1)

  • David Bennett argues the Bitcoin industry is entering a consolidation phase, mimicking legacy finance patterns he believes contradict Bitcoin's original innovative spirit.

Diplomacy (1)

  • US Treasury Secretary Scott Bessant said the US seized $500 million in Iranian cryptocurrency assets as part of Operation Economic Fury, a figure higher than the $344 million in frozen USDT Tether previously reported.

Protocol (4)

  • Bessant claimed Iran's currency has fallen 60-70% against the US dollar and one of its largest banks collapsed in December.
  • South Korean prosecutors seek a 20-year prison term for Delio CEO Zhang Shang Ho, alleging he embezzled $168.8 million in crypto from 2,800 victims over two years.
  • River CEO Alex Leishman argued traditional finance apps are merging with gambling, creating a system where households feel forced into high-risk bets as the safe path of saving erodes.
  • Paul Tudor Jones called Bitcoin the best inflation hedge, surpassing gold, due to its programmatic scarcity. He said current S&P 500 valuations imply negative ten-year returns.

Culture (1)

  • Texas Tech quarterback Brendan Sorsby entered a gambling addiction program after making thousands of online bets, including on Indiana football games while a redshirt freshman in 2022.
#BTC Markets#Banking#Macro#Mining
Bitcoin 2026
Bitcoin 2026

Bitcoin 2026

The Bitcoin Company | Jack Mallers, Strike • Apr 30

  • Jack Mallers says Strike is a global Bitcoin bank selling financial services, offering fee-free Bitcoin acquisition and withdrawal, direct deposit, bill payments, and Bitcoin-backed loans/credit lines.
  • Mallers says Strike lending products are the most successful he has launched in his 14-year Bitcoin career, finding product-market fit by providing liquidity without selling Bitcoin.
  • Strike expanded its Bitcoin-backed loans and lines of credit across most of the United States and parts of the European Union, while lowering its lowest pricing tier to 7.49%.
  • Mallers announced Strike will publish quarterly lending proof-of-reserves with external auditors for transparency, acknowledging customers need trust when collateral cannot be withdrawn.
  • Mallers announced 'volatility-proof loans' as a top customer request, a product where Bitcoin collateral is protected from liquidation despite market price drops.
  • Mallers positions Bitcoin treasury companies like MicroStrategy and Metaplanet as high-conviction but low-operating-income businesses, focused on capital markets not product-building.
  • Mallers defines his ideal Bitcoin company as high-conviction and high-operating-income, with a financial services arm, physical Bitcoin infrastructure, capital markets leverage, and strategic M&A.
  • 21.co holds 43,514 Bitcoin, the second-largest corporate treasury, but Mallers insists he wants to build beyond capital markets into products that change users' lives.
Also from this episode: (6)

Protocol (5)

  • Strike partnered with Tether to offer segregated address collateral for large loans, enabling clients to verify their Bitcoin collateral directly on-chain without rehypothecation.
  • Tether provided Strike with a $2.1 billion credit facility to finance growth in Bitcoin-backed credit products, aiming to meet any demand for loans or lines of credit.
  • Mallers's co-founders proposed merging Strike and Tether's mining business, Electron, into 21.co, aiming to create a company with both financial distribution and Bitcoin production.
  • Mallers positions crypto exchanges like Binance, Coinbase, and Robinhood as high-operating-income but low-Bitcoin-conviction businesses, citing Coinbase's $10 billion fiat versus $1 billion Bitcoin balance sheet.
  • Mallers cites Jim Chanos's analysis showing Robinhood customers lost 5% in February versus a 0.9% S&P 500 drop, framing it as evidence Robinhood promotes hyper-speculation not conviction.

Mining (1)

  • Electron, Tether's mining business, has 50 exahash of capacity representing roughly 5% of the Bitcoin network, built for both economic profit and philosophical network protection.
#BTC Markets#Adoption#Mining#Stablecoins

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