U.S. listed company Sharps Technology (STSS) announced on Monday that it successfully raised $400 million to establish the largest Solana (SOL) reserve company to date, driving the company's stock price to surge by 70%.
Sharps Technology's recent fundraising attracted participation from several heavyweight investment institutions in the cryptocurrency sector, including ParaFi, Pantera, FalconX, CoinFund, and Arrington Capital. According to the transaction details, the issue price is $6.50 per share, accompanied by warrants exercisable at $9.75, with the transaction expected to be completed by August 28.
Driven by positive news, Sharps Technology's stock price briefly broke through $13 during trading, ultimately closing up 53%, significantly higher than last Friday's closing price of $7.3, instantly becoming the market focal point.
Sharps Technology stated that the funds raised will primarily be used to purchase the Solana native token SOL. At the same time, Alice Zhang, co-founder of the Solana ecosystem project Jambo, has also been invited to join the company as Chief Investment Officer and board member to strengthen the company's strategic layout.
Additionally, the Solana Foundation has committed to selling $50 million worth of SOL to Sharps Technology, with the price calculated at a 15% discount from the 30-day weighted average price, subject to certain conditions.
Sharps' actions resonate with the recent rise of digital asset reserve models in the market. These companies raise funds through capital markets and then invest the funds into cryptocurrencies, aiming to replicate the successful experience of MicroStrategy (MSTR). MicroStrategy has continuously bought Bitcoin in recent years and now holds the world's largest corporate Bitcoin treasury, valued at over $70 billion.
This wave of 'corporate coin hoarding' has now spread to Solana. Currently, U.S. companies like SOL Strategies (HODL), DeFi Development (DFDV), and Upexi (UPXI) have announced their increased investment in SOL, with Sharps Technology being the latest heavyweight player to join the ranks.
It is worth noting that these digital asset reserve companies often trade at a premium 'above the actual value of held coins' in the stock market. However, market experts warn that when cryptocurrencies enter a downward cycle, this premium space may quickly converge, compressing investment returns and potentially limiting the company's ability to raise funds further and expand coin hoarding.
"Stock price skyrockets 70%! Sharps Technology raises $400 million to create Solana reserve company" was first published on (Blockke).
