DeFi Development Corp (formerly Janover) aims to raise over $1 billion worth of capital to invest in Solana, the industryโs sixth-largest cryptocurrency by market capitalization.
The Nasdaq-listed firm, previously a real estate financing platform connecting commercial property lenders and buyers, announced its plans in a Form S-3 registration statement filed with the US Securities and Exchange Commission (SEC) on April 25.
The filing states that the funds will be used for general corporate purposes, including Solana (SOL) token acquisitions.
According to the filing, the company may use proceeds from the offering to purchase more Solana, noting:
โSolana does not pay interest, but staking rewards can be earned on Solana. The ability to generate a return on investment from the net proceeds from this offering will depend on whether there is appreciation in the value of Solana following our purchases of Solana with the net proceeds from this offering.โ
The company also warned that fluctuations in Solanaโs price could lead to it converting the tokens into cash at a value โsubstantially belowโ the net proceeds raised.
Related: Deloitte predicts $4T tokenized real estate on blockchain by 2035
Janover was a real estate financing company connecting lenders and buyers of commercial properties before a team of former Kraken exchange executives bought 728,632 shares of its common stock on April 7. Joseph Onorati, former chief strategy officer at Kraken, has since been appointed as chairman and CEO.
The announcement comes shortly after the leadership of DeFi Development Corp adopted a Solana treasury reserve, โby applying a proven public-market treasury model to an asset thatโs earlier in its lifecycle, structurally reflexive, and vastly underexposed as compared to Bitcoins.โ
The firmโs new Solana investment treasury has drawn comparisons to Michael Saylorโs Strategy, which has amassed over 538,200 Bitcoin (BTC) as of April 20 โ the worldโs largest corporate Bitcoin holder.
The firmโs board of directors approved the companyโs Solana-focused treasury policy on April 4, authorizing long-term accumulation and the launch of Solana validators to enable the staking of its treasury asset.
Parker White, the firmโs chief investment officer, who previously served as an engineering director at Kraken exchange, already runs a Solana validator with $75 million in delegated stake.
Related: US banks are โfree to begin supporting Bitcoinโ โ Michael Saylor
Regulatory concerns remain for Solana investment
While the Solana-focused treasury implementation marks a significant step for altcoin adoption, the firm remains concerned by the potential effects of opaque crypto regulations, according to the filing:
โWe may be subject to regulatory developments related to crypto assets and crypto asset markets, which could adversely affect our business, financial condition, and results of operations.โ
The firm cites unclear regulations around digital assets, which may โadversely affect the price of Solanaโ and, in turn, impact โthe market price of our common stock.โ
The firm noted that Solanaโs potential โreclassifyingโ as a security remains a particular concern, which may lead to the firm being classified as an investment company under the Investment Company Act of 1940.
However, the firmโs share price has been benefiting from its Solana acquisitions. Its shares rose by over 12% when DeFi Development Corp added $11.5 million worth of Solana tokens to its treasury on April 22, Cointelegraph reported.
โThe decision by commercial property platform Janover to add SOL to its treasury is truly groundbreaking,โ Chris Chung, founder of Solana-based swap platform Titan, told Cointelegraph. โIโm confident we will see many other businesses follow suit before long as crypto becomes increasingly adopted by traditional finance.โย
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