Faraday Future To Spin Off Crypto Assets: Investor Takeaways

Author: GSBR Research | September 17, 2025 08:00am

Executive Summary

Faraday Future Intelligent Electric (NASDAQ:FFAI) has approved a plan to spin off its Crypto Flywheel assets, including the C10 Treasury, into a separately listed company to be called CXC10. The separation is strategically significant as it draws a clean line between the core EV business and the nascent Web3/crypto venture, giving each entity sharper investor visibility and tailored fundraising avenues. More details are expected at the company's "919 Futurist Day & Stockholders' Community Day" on September 19, 2025.

Spin-Off Details

• What's being spun off: CXC10, housing Faraday Future's "crypto flywheel" assets, primarily the C10 Treasury, digital asset holdings, and related Web3 initiatives.
• What the parent retains: Faraday Future will continue to operate its core EV and mobility ecosystem, including vehicle development, production, and intelligent mobility platforms.
• Tax status: Not disclosed; no confirmation yet whether the transaction will be tax-free.
• Timeline: Yet to be announced. Additional details are expected on September 19, 2025.

Strategic Rationale

The two businneses have no synergies and as such have different operational and capital requirements. By spinning off CXC10, management seeks to:

• Sharpen focus: Separate the volatile, high-risk crypto assets from the EV business, reducing investor confusion and conglomerate discount.
• Enable capital flexibility: CXC10 can fundraise independently from investors aligned with Web3 risk/return, without diluting EV shareholders.
• Investor segmentation: The separation will allow investors to choose exposure based on their rrisk appetite.
• Operational clarity: The separation will allow the crypto business to have its own dedicated governance, reporting, and compliance structures, which may prove critical given crypto's regulatory headwinds.

Parent (Faraday ex-SpinCo)

Post separation, Faraday Future remains an EV story, focused on vehicle development, production milestones, and shared mobility initiatives. The spin-off of crypto assets will appeal to institutional investors who were skeptical of the mixed narrative.

The EV business is ye to start generating revenue. However, with operational losses narrowing and cost control evident, the EV business could become profitable once revenue starts scaling (FX Super One deliveries planned to start by the end of 2025 in teh U.S.)

SpinCo (CXC10)

CXC10 is a small entity today, with disclosed digital asset allocations of roughly US$10m via its C10 Treasury program. Management claims outperformance versus a benchmark index, though audited financials are pending. The ambition is to scale into a broader Web3 ecosystem company, but execution risk is high.

Valuation implications

The spin-off could unlock value for both businesses. For Faraday, separating CXC10 removes noise and may allow the EV business to trade on more traditional auto/tech multiples. On the other hand, a standalone listing for CXC10 in the current bullish environment for cryptocurrencies could allow it to fetch premium valuation.

Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.

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