Solana Treasury holding could potentially double due to Forward Industries' planned $4 billion fundraising.
In a series of recent announcements, two prominent companies in the crypto space, DeFi Development Corp. and Forward Industries, have revealed their plans to raise funds through preferred stock offerings. These moves mirror the funding tactics used by Bitcoin treasury companies like MicroStrategy.
DeFi Development Corp., headquartered in the UK, has registered a preferred stock offering with the Securities and Exchange Commission (SEC). The offering, named Series C Cumulative Perpetual Preferred Stock, is yet to disclose a ticker symbol for trading on Nasdaq Capital Markets, where the company has applied for listing. At the time of writing, the shares are trading for $17.40, approximately 4.3% lower than their previous close.
Meanwhile, Forward Industries, a Solana treasury company, has filed to raise $4 billion. The company's automatic shelf registration on its S-3 form is already effective, meaning the shares will be tradable once they're sold. Forward Industries named Cantor Fitzgerald as the sale agent for the offering, and the proceeds will be used for working capital, Solana token strategy, and purchasing income-generating assets.
If Forward Industries sells all the shares and spends the proceeds on Solana, it could more than double the amount of SOL being held in treasuries. At the time of writing, there's already $3.1 billion in Solana treasuries, according to CoinGecko.
Dan Kang, head of investor relations at DeFi Development Corp., commented that the goal is to test market receptivity to preferred structures. Kang believes these structures can work well for Solana treasury companies due to their validator, staking, and on-chain activities providing consistent dividend or coupon coverage.
Interestingly, Robinhood has announced its intention to file for a preferred stock offering with the SEC, using similar financing strategies as Bitcoin treasury companies like MicroStrategy. This raise is nearly the same size as Bitcoin treasury Strategy's Stride preferred stock raise in July.
It's worth noting that Forward Industries' stock (FORD) fell 8.2% following the announcement. At the time of writing, Solana is trading for $235.45, and 90% of predictors on Myriad, a prediction market, think Solana will reach $250 before seeing a significant retrace.
This story was updated to add comment from DeFi Development Corp. Head of Investor Relations Dan Kang. The preliminary SEC registration doesn't specify the fixed rate for quarterly dividends, and Cantor Fitzgerald will collect a 3% fee for the offering.
