Solana Company (HSDT), the digital asset treasury company formerly known as Helius Medical Technologies and backed by Pantera Capital, has made progress in unlocking shares to early investors in its $500 million PIPE round, as the company’s shares trade below the initial purchase price.
The shares, sold in a private placement in September for $6.881 each, became eligible for sale ahead of schedule, the company said in a news release Monday. HSDT shares fell to around $6.50 after a sharp three-session decline that erased nearly 60% of its market value, including a 17% decline on Monday.
“‘Rip the band-aid’ is the approach we’re confidently taking, while many other DATs choose to stagnate,” the company posted on X on Monday.
“The pressure on our stock price that accompanies the effectiveness of the resale registration statement will likely shake up weak hands, but we believe it will also establish a remaining base of long-term committed shareholders,” Joseph Chee, the company’s executive chairman, said in a statement.
Private Placement through Public Equity Transactions, or PIPE for short, allows institutional investors to purchase shares of public companies at predefined prices, often at a discount. It has become a favored method among recently launched digital asset treasury companies to quickly raise capital to accumulate cryptocurrencies.
However, several companies saw their stock prices plummet when the sales record for PIPE investors went live, raising doubts about the sustainability of the structure in crypto markets.
HSDT stock surged above $25 following the PIPE deal before plunging more than 70% as digital asset cash hype in the market petered out.
Read more: The rise and (mostly) fall of the PIPE model in Bitcoin cash strategies
