Solana Company (HSDT), the digital asset treasury firm formerly known as Helios Medical Technologies and backed by Pantera Capital, has moved forward with unlocking shares for early investors in its $500 million PIPE round as the company’s stock is trading below the initial purchase price.
The shares, sold at $6.881 each in a private placement in September, have become eligible for sale ahead of schedule, the company said in a press release on Monday. HSDT shares have fallen to around $6.50 after three sessions of steep decline, knocking nearly 60% off its market value, including a 17% drop on Monday.
“‘Ripping off the Band-Aid’ is the approach we’re confidently taking, while many other DATs are choosing to wait,” the company posted on X on Monday.
“The pressure on our stock price coupled with the effectiveness of the resale registration statement will shake weak hands, but we believe it will also establish the remaining foundation of committed long-term shareholders,” Joseph Chee, the firm’s executive chairman, said in a statement.
Private placements in public equity deals, or PIPEs for short, allow institutional investors to buy shares of public companies at pre-determined prices, often at a discount. It has become a preferred method among recently launched digital asset treasury firms to rapidly raise capital for depositing cryptocurrencies.
However, when sales registrations for PIPE investors went live many companies saw their stock prices decline, raising doubts about the sustainability of the structure in the crypto markets.
HSDT stock soared above $25 after the PIPE deal and then dropped more than 70% as the digital asset treasury hype fizzled out across the market.
Read More: The Rise and (Mostly) Fall of the PIPE Model in Bitcoin Treasury Strategies