A new digital assets treasury company is set to hit the public markets. On Monday, a neurotechnology company called Helius Medical Technologies announced that it was raising up to $1.25 billion in a private shares sale to stockpile Solana, one of the world’s largest cryptocurrencies. The deal included $500 million of capital on hand and $750 million in warrants to fund future purchases of Solana.
Pantera Capital, one of the biggest venture capital firms in crypto with over $5 billion in assets under management, and Summer Capital, an investment firm headquartered in Hong Kong, led the fundraise. Other participants included the crypto prime brokerage FalconX, the venture investor Animoca Brands, and Laser Digital, the crypto arm of the Japanese investment bank Nomura.
As part of the deal, Joseph Chee, founder and chairman of Summer Capital, will become chairman of Helius Medical Technologies’ board. Cosmo Jiang, general partner at Pantera, will also be a board director. And Dan Morehead, founder and CEO of Pantera, will become a board advisor.
“We believe we have the right setup to be the leading, if not, at least one of the two or three, but certainly the leading, Solana DAT [digital asset treasury],” Jiang told Fortune in an interview.
DAT deluge
The company is the latest entrant in crypto’s hottest trend: loading up the balance sheets of small publicly traded companies with cryptocurrency.
The strategy was first popularized by the company Strategy, formerly called MicroStrategy. In 2020, Michael Saylor, founder and executive chairman, announced that his firm was adding Bitcoin to its balance sheet. Traders soon saw the stock for Saylor’s company as a proxy for the world’s largest cryptocurrency, and as Bitcoin surged, so did Strategy’s shares—well beyond the price of the underlying crypto held by the firm.
Saylor’s success has sparked a wave of imitators who have persuaded public companies to buy up Bitcoin. Others have sought to follow the Saylor playbook by standing up DATs dedicated to more exotic cryptocurrencies like XRP, Dogecoin, and even a token launched by a Trump family business. From January to early September, 209 firms have said they were planning to raise more than $145 billion for crypto treasury strategies, according to data from Architect Partners, a crypto M&A advisory and financing outfit.
Proponents say these new firms give investors exposure to cryptocurrencies they wouldn’t normally be able to trade through their brokerage accounts. Critics say digital asset treasuries are a fad.
Still, it’s a crowded market, and Pantera and Summer Capital’s Solana-focused company isn’t even the largest of its kind. There are early entrants like Upexi as well as a new vehicle chaired by Multicoin Capital managing partner Kyle Samani that raised $1.65 billion last week.
Jiang, the general partner at Pantera, said he believes that there can only be a handful of successful public companies devoted to just one cryptocurrency, and the deal structure for his Solana treasury firm positions it to be competitive.
“We’d much rather start with a moderate size so that we can really go out to market and grow very quickly, rather than start too big and then have a harder time growing on a percentage basis,” he said.
In other words, he and others who helped facilitate the deal designed it so the $500 million fundraise can quickly be followed with a $750 million injection of capital, a one-two punch of funding power.
“Just as much as it is about scale,” he said, “it’s about velocity.”
